Photo of Dung Quất Oil Refinery in the central region province
of Quảng Ngãi.- VNA/VNS Photo Huy Hùng
NỘI - The tax reduction for Dung Quất Oil Refinery is necessary and
reasonable to ensure equal principles between local and imported products, Đỗ
Hoàng Anh Tuấn, the deputy minister of finance, said.
“The reduction would also
follow the reasonable protection level under international commitments when
Việt Nam joins the trade pacts,” Tuấn said.
Previously, the Bình Sơn
Refining and Petrochemical Co (BSR), which operates and manages Dung Quất,
was seeking approval to lower tax rates because of a lack of competitiveness against
imported fuels as well as untie its difficulties.
The diesel and mazut import
taxes from ASEAN countries were cut from 20 per cent to 10 per cent since the
beginning of this year in accordance with the ASEAN Trade in Goods Agreement
(ATIGA). However, products from Dung Quất are still subject to an import tax
of 20 per cent, forcing a number of local businesses that bought petroleum
from Dung Quất to choose other imported sources.
The deputy minister told the
media last week that the consumption of the refinery has faced with
difficulties due to the plunging price in the world oil market.
In addition, under the Free
Trade Agreement (FTAs) with South Korea, which was signed in May 2015, Việt
Nam reduced the import tariff on gasoline from South Korea to 10 per cent,
from 20 per cent, effective December 20, 2015.
He said that there was a big
difference between the normal imported taxes and preferential taxes under
The preferential policies for
the Dung Quất Oil Refinery including corporate income tax and investment are
under the government’s regulations.
This is the reason that there
are no special favours for the refinery, but it is equal to other projects,
The ministry would submit to
the Government to review suitable financial mechanism in the market mechanism
and ensuring equality between domestic and foreign businesses.
Specifically, the ministry
would remove the cash subsidy mechanism for BSR if the imported tax is lower
than 7 per cent.
Currently, under the finance
ministry’s instructions, the calculation for import duty of petroleum
products is under most-favoured nation (MFN) status.
The Ministry of Industry and
Trade yesterday sent a press release saying that it has co-operated with the
finance ministry to have financial solutions to resolve the imported tax
reduction under FTA road map following international integration commitments
to ensure benefits of the government, businesses, petroleum production and
However, the ministry has not
provided a road map to narrow down the difference of imported taxes between
FTAs and MFN in the calculation of the basic price of petroleum. - VNS