The New Simplified Residential Electricity Tariff: A Five-Tier System

At the questioning session of the National Assembly Standing Committee on the morning of August 21, NA Deputy Pham Van Hoa (Dong Thap delegation) highly appreciated the efforts of the Ministry of Industry and Trade in electricity supply for consumption and production. If power shortages occurred locally in 2023, there has been a very clear improvement this year.

However, Mr. Hoa pointed out that the current electricity tariff calculation method is not suitable for people’s lives. In particular, the first step of electricity consumption for households is set at a level of only 0 – 50 kWh. In addition, people also have to bear the value-added tax (VAT 10%).

Therefore, Deputy Pham Van Hoa proposed that the Ministry of Industry and Trade study and raise the electricity consumption level of households to 100 kWh and calculate whether VAT can be removed?

In response, Minister of Industry and Trade Nguyen Hong Dien said that the tiered electricity price framework is a popular model in all countries to encourage customers to use electricity efficiently. Because electricity is a very different product compared to other industries, the more it is produced, the more it affects the environment.

Currently, Decision No. 28/2014/QD-TTg stipulates the average retail electricity price with 6 price levels.

Implementing the resolution of the National Assembly Standing Committee and the direction of the Government, the Ministry of Industry and Trade has chaired the amendment of this Decision. Accordingly, in the draft submitted to the Government on the morning of August 21, the retail electricity price was recalculated into 5 levels. In particular, the first level was raised from 0 – 50 kWh to 0 – 100 kWh, as suggested by Deputy Pham Van Hoa.

This calculation method, according to the Minister of Industry and Trade, will contribute to supporting the poor. At the same time, the level of support for the poor remains the same, with the state budget supporting up to 30 kWh. From 30 kWh to the end of the first tier, consumers still have to pay as regulated.

In addition, to eliminate the unreasonable gap between electricity users, the draft proposes to adjust the electricity price frame in production and consumption to be closer. Some production industries are adjusted corresponding to the price table in the field of services to ensure that there is no cross-subsidization between electricity users.

Regarding the VAT issue in electricity bills, Minister Nguyen Hong Dien said that this is a regulation of the tax law applied to all goods and services when trading. As the head of the industry and trade sector, he said that the Minister of Finance would give a clearer answer as to whether it could be removed.

Also questioning the Minister of Industry and Trade, NA Deputy Thach Phuoc Binh (Tra Vinh delegation) and NA Deputy Chu Thi Hong Thai (Lang Son delegation) reflected the serious situation of counterfeit and counterfeit goods. The National Assembly deputies proposed that the Minister of Industry and Trade focus on clarifying the solutions that have been and are being deployed to solve this problem.

Minister Nguyen Hong Dien affirmed that in a market economy, the prevention of smuggling, trade fraud, and smuggling of counterfeit and poor-quality goods is very important, especially in the environment of e-commerce.

In the past time, to improve the effectiveness of this work, the Ministry of Industry and Trade and related agencies have advised competent authorities to issue many mechanisms and policies to overcome this situation, typically advising the issuance of the Law on Protection of Consumer Rights, the Project against counterfeit and poor quality goods, and amending and supplementing regulations. sanctions in traditional and e-commerce.

At the same time, the Ministry also deployed a mechanism to receive and handle information via the Electronic Information Management and Consumer Rights Protection Portal – this is the National Portal at the Department of E-Commerce and Digital Economy (Ministry of Industry and Trade).

In addition, the Ministry of Industry and Trade coordinates well with local forces in the prevention of trade fraud; requiring websites to inspect and remove thousands of stalls of counterfeit and poor-quality goods; strengthen communication to guide consumers. Build a database and share information with related agencies (public security, information technology, finance, banking)…

In the coming time, the Ministry of Industry and Trade will continue to advise competent authorities to amend and supplement regulations on sanctions for violations in e-commerce and protection of consumer rights; improve the construction of databases and information sharing between related agencies to handle counterfeiting and counterfeiting, and strengthen communication so that consumers can improve their knowledge and protect themselves…