A Hanoi councilor meeting on December 8 approved a plan to increase car registration fees by nearly double and license plate fees tenfold in an effort to reduce individual vehicles.
The registration fee for cars with less than 10 seat will be increased from the current 12 percent of the sales price to 20 percent, and the license plate fee to VND20 million (US$952), news website VnExpress reported.
Hanoi People's Committee suggested the raises earlier, based on analysis that the number of individual vehicles, especially cars with fewer than 10 seats, has increased in the past few years beyond the city's infrastructure capacity.
Figures from the Hanoi Transport Department showed that there's one car driver's license among every 13 people in Hanoi.
According to Vietnam Register, between January and July 2011, Hanoi licensed 4,000 cars each month.
Khuat Viet Hung from the University of Transport told Thanh Nien Weekly in an interview in October that the capital has nearly 400,000 cars that used 55 percent of the road space and 65 percent of all parking space during peak hours.
The new fees are expected to help reduce traffic and to enrich the city budget for road and bridge development, the committee said.
However, the councilors rejected the committee's proposal to increase parking fees, saying that parking lots already make a lot of profit.
Deputy Vu Manh Hai suggested a parking fee management system, as many private parking lots are charging as much as they want.
Another deputy, Nguyen Thi Thuy, said parking lots at hospitals and apartment buildings already have raised their fees from VND2,000 to VND5,000 in the city downtown, and to VND3,000 in the outskirts.
Thuy said the fees are expensive for many apartment dwellers who earn just more than VND2 million per month, and to families of hospital patients that sometimes use the parking lots five to six times per day.
The new car fees will take effect the beginning of 2012.