Luxury car prices will increase by up to 2 billion VND starting July 1st.

According to the plan, starting July 1st, the prices of luxury, super luxury, and supercar cars with engine capacities from 3.0L to 6.0L will all increase by 500 million to approximately 2 billion VND per vehicle.

Starting July 1st, vehicles classified as luxury, super luxury, and supercars with engine capacities of 3.0L or more will begin to be subject to the amended Special Consumption Tax Law. This will lead to a significant increase in the prices of these vehicles. Meanwhile, the prices of vehicles with smaller engine capacities will decrease thanks to this new tax policy.

Accordingly, these car models are only subject to a 60% special consumption tax, but with the new tax rate, imported cars with engine capacities from 3.0L-4.0L will increase in price by about 15%-20%, cars from 4.0L-5.0L by about 20%-30%, cars from 5.0L-6.0L by about 30%-40%, and cars over 6.0L by about 40%-50% depending on the model, compared to the selling price before July 1, 2016.

With the upcoming excise tax increase, the prices of luxury cars, super luxury cars, and supercars will rise sharply. Photo: VNN

Therefore, for imported luxury cars with engine capacities from 3.0L to 6.0L, the price will increase from 500 million to approximately 2 billion VND per car, depending on the model.

However, with such an increase, luxury and supercar models will see a very strong price surge.

For example, if a 40-50% increase in excise tax is applied to a 6.5L Lamborghini Aventador LP 700-4, the current official selling price in Vietnam of 22.5 billion VND could rise to nearly 34 billion VND. Similarly, a standard Rolls-Royce Ghost Series II with an engine capacity exceeding 6.0L, currently priced at around 17 billion VND, would see an increase of approximately 8 billion VND under the new tax.

This is considered the highest excise tax rate ever applied to these types of vehicles.

With this new tax approach, the consumption of these car models in the market will decrease significantly, especially since the luxury, super-luxury, and supercar segments are still small in Vietnam. Leaders of several domestic automobile assembly joint ventures told Vietnamnet that with the high tax increase, imports will decrease; therefore, what was thought to be an increase in revenue will ultimately result in a loss of budget revenue.

It's worth noting that when wealthy individuals (often involved in business) buy a car, the cost is passed on to the price of the products and services they provide to customers. Therefore, in reality, it is the customers who ultimately pay for the car that the wealthy individual acquires.

On the other hand, some luxury and supercar brands that have just entered Vietnam, a potential market, have not yet had time to stabilize their business before having to suffer the shock of a drastic tax increase.

Supercars like these can cost tens of billions of Vietnamese dong.

VOV reported that at a seminar organized by the Central Institute for Economic Management Research, representatives from Ford and Mercedes-Benz Vietnam unanimously criticized the government's abrupt tax changes, which make it difficult for businesses to develop long-term plans. This is especially concerning given the sharply rising road and transportation costs, and the Ministry of Finance's change in the calculation of excise tax for importers (wholesale price), which now stipulates that it cannot be lower than 105% of the import cost. This means that all labor, transportation, and advertising costs are included in the tax calculation.

However, there are quite optimistic assessments on this issue. According to economic growth reports, the number of wealthy people in Vietnam is increasing rapidly, leading to a strong increase in demand for luxury and supercars. Therefore, even if car prices rise sharply, it will not deter wealthy individuals from purchasing supercars in the future.

According to ngaynay.vn