Cars from 1.5 billion VND are expected to pay how much property tax?

Minh Hy DNUM_BEZAEZCABI 17:23

The proposed Property Tax Law will make car buyers from 1.5 billion pay 0.4% tax, or from 6 million and up.

The Ministry of Finance has proposed to the Government to submit to the National Assembly a draft Law on Property Tax. In this law, automobiles are one of the taxable objects, in the same group as airplanes and yachts. These three types of vehicles, if valued at VND 1.5 billion or more (not used for business purposes, transporting goods or passengers), will be taxed according to two options: 0.3% or 0.4%.

For new cars, the taxable value is the value determined by the provincial People's Committee. For used cars, this value will be equal to the new car value multiplied by the remaining quality percentage.Assuming the Property Tax Law finalizes the 0.4% tax rate for cars, the tax rate that car buyers have to pay will be calculated as follows.

1. With new car

Mr. A bought a Mercedes GLC for 2 billion. Suppose the Provincial People's Committee sets the car's value equal to the company's selling price, then the taxable price will be 2,000 x 0.4% = 8 million VND. Thus, the total cost Mr. A must pay to own the car will increase by 8 million.

Particularly for tycoons who buy super luxury cars, supercars worth tens of billions, for example Rolls-Royce Phantom worth 40 billion, the tax will be 160 million.

2. With old cars

Mr. B bought a 2015 Audi Q7. When he first bought the car, it cost 3 billion. Suppose the People's Committee bases the old car depreciation rate on the same calculation method as the Ministry of Finance to pay the current registration fee as follows:

Number of years of useRemaining RateInitial value
(million)
Residual value
(million)
185%3,0002,550
1-370%3,0002,100
3-650%3,0001,500
6-1030%3,000 900
Over 1020%3,000 600

The 2017 Q7 will be used for 1-3 years, the remaining value is 70% of the new purchase price, equivalent to 2.1 billion. At that time, the buyer of this car, in order to register for circulation, will have to pay an additional property tax of 2,100 x 0.4% = 8.4 million.

Also in this proposed Law, the taxable value will be kept stable for 5 years. That means, if Mr. A's new Mercedes GLC costs 2 billion in 2018, then by 2023, the taxable value will still be 2.3 billion, regardless of whether the company increases or decreases the price of the product.

According to the Ministry of Finance, there are currently three countries in the world that also impose property taxes on cars: South Korea, Kazakhstan and Bolivia. Experts say that this tax plan does not affect customers who buy popular cars, which are mainly priced under 1 billion or a little more.

If the proposed new Property Tax Law becomes a reality, this will be another factor that pushes up the cost of buying a car for Vietnamese people, in addition to the more than 10 current taxes and fees.

According to vnexpress.net
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Cars from 1.5 billion VND are expected to pay how much property tax?
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