Car import tax from Japan will be 0% from 2029
Cars imported from Japan may have their tax cut to 0% according to the commitment schedule in the CPTPP Agreement, but from 2029.
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) was signed in Chile on March 8. An important content is that 11 countries will reduce import tax to 0% for industrial goods, including cars. That means cars imported from Japan to Vietnam will have the opportunity to enjoy 0% tax in the near future.
|
Currently, cars imported from Japan to Vietnam are mainly Lexus, Subaru and some odd Toyota models. |
Mr. Luong Hoang Thai, Director of the Multilateral Trade Policy Department (Ministry of Industry and Trade) said that Vietnam will eliminate taxes in the 13th year since the CPTPP Agreement takes effect for new cars, and cars with a cylinder capacity of 3 liters or more will be eliminated in the 10th year.
Mr. Thai added that the CPTPP has just been signed and has not yet been ratified by each country. For Vietnam, the agreement will be submitted to the National Assembly for ratification around the end of 2018. It is expected that the agreement will take effect from 2019. Thus, it will take at least 10 years, or 2029, for the import tax from Japan to Vietnam to be 0%, and for vehicles under 3 liters, it will take another 13 years, or until 2032.
Currently, the cars imported from Japan to Vietnam are mainly Lexus, Subaru and some Toyota models such as Land Cruiser, Prado, Honda Odyssey. Toyota Vietnam representative said that the company has not recorded any information about this, nor has there been any clear document. The problem that Lexus needs to solve now is how to import cars for sale.
Mr. Pham Anh Tuan, general director of strategic planning department of Toyota Vietnam, said that Japan does not issue type quality certificates for cars exported to Vietnam, so the company cannot import cars for sale, and cars at domestic dealers are almost sold out.
"We have to switch to importing Lexus from Japan but for the European market," Mr. Tuan said about the immediate solution. Currently, there is a VTA certificate for the NX300. But he is also worried that cars for the European market have many details different from those in Vietnam, which may not be accepted by the Registry. In addition, different technology content can push up the price of the car.
If by 2029, Lexus Vietnam solves the problem of importing cars from Japan with 0% import tax, the car price will be very competitive. However, the journey to this point is still too long, changes in government policy can affect the company's business plan.
