Registration fees for pickup trucks and vans officially increased 3 times

The Government has just issued Decree No. 20/2019/ND-CP to amend and supplement a number of articles of Decree No. 140/2016/ND-CP (dated October 10, 2016) of the Government on registration fees.

In particular, the amendment and supplement to Clause 5, Article 7 is considered very noteworthy. The new Decree still clearly stipulates the fee that customers must pay when purchasing cars: "Cars, trailers or semi-trailers pulled by cars, similar vehicles, the fee is 2%".

And "passenger cars with 9 seats or less pay the first registration fee at a rate of 10%. In case it is necessary to apply a higher rate to suit the actual conditions in each locality, the People's Council of the province or centrally-run city shall decide to adjust the increase but not to exceed 50% of the general rate prescribed in this point."

However, the registration fee for pickup trucks and vans, which are currently popular with many customers, has officially increased, no longer 2% but to 60% of the original fee for passenger cars with 9 seats or less.

With the current fee for cars with less than 9 seats as regulated above, it will be in the range of 10-15%. This means the first registration fee for pickup trucks and vans will increase to 6-9%.

Will pickup trucks still be popular in Vietnam after the new fee is applied?

"Cars that can carry both people and goods (Pick-up trucks) with a permitted transport weight of less than 1,500 kg and 5 seats or less, and VAN trucks with a permitted transport weight of less than 1,500 kg must pay the first registration fee at a rate equal to 60% of the first registration fee for cars carrying 9 seats or less," Decree No. 20/2019/ND-CP clearly states.

For example, in Hanoi, Da Nang and Hai Phong, the registration fee for cars with less than 9 seats is 12%; according to Decree No. 20/2019/ND-CP, the new registration fee for pickup trucks and vans will be 7.2%. Ho Chi Minh City and Can Tho currently have a registration fee for cars with less than 9 seats of 10%, the new registration fee for pickup trucks and vans will be 6%.

Meanwhile, Decree No. 20/2019/ND-CP also stipulates that the registration fee from the second time onwards for the above types of cars "is 2% and is applied uniformly nationwide".

The new registration fee will take effect from April 10, 2019. The pickup truck segment in the Vietnamese market experienced a turbulent 2018 with sales reaching only 18,491 units, down 31.8% compared to 2017. The sharp decline in sales was seen in the first 8 months of the year, as pickup truck models encountered difficulties in the import process.

In January 2019, pickup truck sales reached 2,522, up 4.2% over the same period last year; along with that, VANs also reached 222 sales, up 43.2%. This has signaled a successful year for these "passenger and cargo" vehicles in Vietnam. However, the new registration fee may prevent that when currently pickup trucks or VANs will no longer have many advantages for customers to choose.