Hanoi (VNA) – The Government’s efforts to restrict auto consumption have taken effect, helping the country see an eight-month record low in the imports of the commodity in August.
According to statistics from the General Statistics Office (GSO), in August the country imported only 1,700 CBU (completely-built unit) cars worth 44 million USD. There were over 2,000 units totalling 51 million USD in July.
However, due to the sharp increase of vehicle imports in the first half of the year, the country in the first eight months still spent 843 million USD on the imports of more than 44,000 units.
In the wake of the Government’s restrictions on the consumption of luxury products including 4-9 seat cars, the number of imported cars has dropped sharply both in value and volume over the past few months, the GSO reported.
In the first quarter, the number of imported vehicles fluctuated around 10,000 units per month.
According to various analysts, the number of vehicles imported in August could be considered the absolute minimum, mainly because this month saw a large number of trucks and vehicles with 24 seats or more. The number of four seat cars, which are restricted by the Government, was insignificant.
Several auto dealers also affirmed that they stopped importing four seat cars in August as the market was frozen, adding that they would continue to cut down for the rest of the year, and to sell the stockpiles if the Law on Special Consumption Tax, which is drafted by the Ministry of Finance, is approved.
Under the draft law on Special Consumption Tax, which will be submitted to the National Assembly for approval in November with the aim of curbing the import of luxury goods, cars will be the most affected. This is due to the tax level levied on cars with 6-9 seats being raised from the 30 percent to 50, 60 or 70 percent, depending on their cylinder-capacity.
The finance ministry restrictions on the import of CBU cars still saw increases of 265 percent in value and 290 percent in quantity for the seven-month period, though much shallower in the second quarter of 2008 due to three consecutive tax rises from 60 percent to 83 percent.
According to economists, current tariffs on luxuries, already at a high level, have not been able to constrain the recent influx of these items – including 4-9 seat cars – into Vietnam . In the first eight months of 2008, luxury imports helped bring import turnover to 59.3 billion USD, resulting in a trade deficit of 16 billion USD.-Enditem
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