Importing luxury cars with tax evasion before July 1st still have to pay high tax

A representative of the General Department of Taxation said that racing units that imported cars before June 30 to avoid high special consumption tax, but sold cars after this time, will still be charged according to the new rate.

Importers still have to pay special consumption tax under new regulations if they sell cars after July 1.

The above information was given by Mr. Nguyen Van Phung - Director of the Department of Large Enterprise Tax Management (General Department of Taxation) at a recent tax conference organized by Finance Magazine. Mr. Phung said that there is a phenomenon of many importers racing to import cars before July 1 - the date when the special consumption tax increase takes effect - to avoid high taxes. These importers expect to import cars at low taxes and wait until after July 1 to sell them to consumers at high prices to make a profit.

However, the Circular allows tax authorities to collect additional taxes on vehicles imported before June 30 but sold after July 1. "Customs officers can completely collect additional special consumption tax on vehicles sold after July 1 and calculate the special consumption tax rate according to the new Law," Mr. Phung said, affirming that this information was clearly disclosed beforehand.

Special consumption tax on many large-capacity vehicles will increase sharply from July 1. Vehicles with engine capacities from 2.5 to 3 liters will have their special consumption tax rate increased from 50% to 55%. Tax on vehicles with 3-4 liters will increase from 60% to 90%, vehicles with 5-6 liters will be 130% and vehicles over 6 liters will be subject to 150%.

Figures from the General Department of Customs also show that the number of luxury cars imported to Vietnam has increased sharply ahead of July 1. In June alone, the number of completely built-up cars imported to Vietnam decreased by nearly 30%, but the import value still increased, showing that traders are rushing to import luxury cars ahead of the July 1 tax increase.

According to VNE