Vietnam is a rapidly developing country in the dynamic economic region of the Asia Pacific region. This area is experiencing high economic growth, continuously for many years, and people’s living standards are also increasingly improved. Therefore, the demand for imported cars is high, so Vietnam’s auto market is considered a potential market. So what is the policy related to Vietnam’s automobile import tax?
So, let’s find out more about the above issue with Lawyer X.
What is car import tax?
Car import tax can be understood as the state’s tax collection on automobile products (complete units) originating from other countries that are imported into Vietnam’s market. The calculation of import tax on automobiles is different from the calculation of import tax on other items on the market.
Vietnam’s automobile import tax policy
When buying imported cars from countries around the world, customers will have to bear the following taxes and costs:
– Taxes: Import tax, excise tax, VAT
– Fees: Registration fee, road fee, license plate fee, compulsory insurance fee
Rolling price of imported cars = Selling price + Import tax + Special consumption tax + VAT + Registration fee + Road fee + License plate fee + Compulsory insurance fee
Vietnam’s automobile import tax policy
Car import tax in 2022
The formula for calculating import tax on cars in 2022:
Car import tax = Selling price x Tax rate
Currently, Vietnam is applying many automobile import tax policies with fees for each manufacturing country and is divided into stages:
Stage 1: Before 2018, the car import tax for passenger cars with 9 seats or less, the fee will be:
– ASEAN region: 30%
– Other regions (Europe, America…): 70-80%
Phase 2:
From January 1, 2018, based on the content of the ASEAN Trade in Goods Agreement (ATIGA), for car models with a localization rate in ASEAN of 40% or more, the import tax rate will be increased. will be 0% provided the manufacturer meets the following conditions:
– Have a standard car warranty and maintenance facility
– There is a recall authorization letter from a foreign manufacturer
– There is a certificate of quality from the manufacturer
– Check the quality of 1 vehicle in every imported shipment.
– Minimum warranty of 2 years or 50,000 km for used imported cars
– Having sufficient import documents as prescribed from 01/01/2018
Phase 3:
From January 1, 2021, car models originating from the EU will be applied a new import tax rate from 60.5% – to 63.8% depending on cylinder capacity, down from 6.7% – to 7.4% compared to before. After the Free Trade Agreement (EVFTA) is approved, the tax rate applied to cars imported from Europe (from 9 seats down) to Vietnam will be 0% within 7-10 years. The tax rate will be reduced on a yearly or cyclical basis.
– Vehicles with a large displacement of over 2,500ccs will reduce to 0% after 9 years
– Vehicles with a displacement of less than 2,500ccs will be reduced to 0% after 10 years
Note: The content of the EVFTA Agreement also clearly states that Vietnam’s tax commitment does not apply to used cars, passenger cars, cars with 10 seats or more and cargo vehicles.
Special consumption tax
The formula for calculating excise tax:
Special consumption tax = Selling price x Tax rate
Special Consumption Tax (SCT) for imported cars is calculated based on the car type (number of seats) and cylinder capacity.
Value Added Tax (VAT)
Any product or commodity in Vietnam is subject to value-added tax (VAT).
Value-added tax will calculate according to the formula based on the provisions in Articles 6 and 7 of the Law on Value-Added Tax 2008, amended and supplemented in 2016, the way to calculate value-added tax for imported cars is as follows:
Value Added Tax (VAT) = (Import price at border gate + Import tax + Special consumption tax) x Value added tax rate
According to Article 8, Law on Value-Added Tax, the value-added tax rate is 10%. Imported cars are not on the tax-exempt list (VAT=0%), so the VAT tax rate will be 10% for all car models.
Registration tax
The calculation of the car registration fee calculates as follows:
Car registration fee = Registration fee calculation price x Proportional fee rate (%)
or Car registration fee = (Import price at border gate + Import tax + Special consumption tax + VAT)x Fees collected in percentage (%)
– The registration fee calculation price will be based on the regulations of the Ministry of Finance for each type of vehicle (Decision 618/QD-BTC is adjusted and supplemented with Decision 1112/QD-BTC, Decision 2064/QD-BTC). BTC and Decision 452/QD-BTC).
– The fee rate is based on Clause 5, Article 7 of Decree 140/2016/ND-CP as amended and supplemented by Point a, Clause 2, Article 1 of Decree 20/2019/ND-CP.
– 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 city under central authority shall decide to increase it, but not exceeding 50% of the prescribed rate. general (i.e. no more than 15%).
How to calculate tax/fee for imported cars in Vietnam today?
The total amount of taxes/fees to pay when buying imported cars in Vietnam that calculated using the following formula:
Total taxes/fees = (Import Tax + Special Consumption Tax + VAT + Registration Tax) + (Registration Fee + Road Maintenance Fee + Signage Fee + Compulsory CIT)
For example: In February 2021, a customer in Hanoi wants to buy an imported Mercedes-Benz GLA 250 4 Matic SUV 2021 priced at $38,230 in Germany (equivalent to VND 881,583,800, with an exchange rate of VND 23,060), then The total taxes/fees customers will have to bear are as follows:
| TT | Items | Rate(%) | Money | Formula |
| 1 | Vehicle value | 881.583.800 | ||
| 2 | Import Tax | 63.8 | 562.450.464 | (1) x 63.8% |
| 3 | Special consumption tax (vehicle 2.0) | 50 | 440.791.900 | (1) x 50% |
| 4 | VAT | 10 | 188.482.616 | ((1)+(2)+(3))x10% |
| 5 | Registration fee | 12 | 248.797.053 | ((1)+(2)+(3)+(4))x12% |
| 6 | Car inspection fee (5-seat car) | 340.000 | ||
| 7 | Road maintenance fee (1 year) | 1.560.000 | ||
| 8 | License plate fee | 20.000.000 | ||
| 9 | Mandatory insurance fee | 480.700 | ||
| The total value of the car | 2.344.485.535 | (1)+(2)+(3)+(4)+(5)+(6)+(7)+(8)+(9) |
Related article:
How to look up personal tax code in Vietnam
Cases of not deducting input value-added tax in Vietnam
Frequently asked questions
– Organizations and individuals producing export goods have establishments producing exported goods in the Vietnamese territory; have the right to own or use machinery and equipment at the production establishment suitable for imported raw materials, supplies, and components for the production of exported goods;
– The value or quantity of imported raw materials, supplies, and components eligible for tax refund is the value or quantity of imported raw materials, supplies, and components used to manufacture the products that are exported;
– Exported products may go through customs procedures according to the type of export production;
– Organizations and individuals that directly or entrust the import of goods and export of products.
If the dossier is inspected first, tax refunded later: The director of the Sub-department of Customs where the tax amount is requested for refund shall issue an inspection decision; In case of tax refund dossiers, check later: The Director of the Customs Department of the province or city decides to inspect tax refund according to the principle of risk management within 10 (ten) years from the date of issuance. issue the tax refund decision according to the provisions of Article 143 of Circular 39/2018/TT-BTC.
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