The Vietnam Tax Consultants Association (VTCA) has recently submitted a document to the National Assembly’s Economic and Finance Committee, providing feedback on the draft Law on Special Consumption Tax (amended). This draft law has already received feedback from the National Assembly during their 8th session back in November 2024.
There are current proposals to increase the special consumption tax on pickup trucks |
The draft law proposes amendments to the description of automobiles and specifies tax rates for pickup trucks (also known as pickup trucks – PV) that fall under the category of passenger cars and four-wheeled vehicles with a capacity of up to nine seats. Accordingly, a suitable tax rate of 60% of the tax rate applied to passenger cars will be applied to pickup trucks with double cabins and VAN trucks with two or more rows of seats.
Commenting on this, VTCA stated that the characteristic of a double-cabin pickup truck is a combination of a passenger car and a cargo truck. They are designed with a high chassis, good load-bearing capacity, multi-purpose functionality, and the ability to navigate through various terrains. These vehicles can transport goods and equipment to areas with challenging and inaccessible terrain.
According to statistics from the Vietnam Automobile Manufacturers’ Association (VAMA), the breakdown of pickup truck users is as follows: 70% in provinces and cities outside Hanoi and Ho Chi Minh City, and 30% in Hanoi and Ho Chi Minh City.
The statistics also show that 36% of these vehicles are used by agencies and businesses, while 64% are used by individuals, mainly for transportation and small-scale commercial purposes.
VTCA shared that the current special consumption tax rates for double-cabin pickup trucks are 15%, 20%, and 25%, depending on engine capacity. According to the new proposal, the tax rate for these vehicles will increase from 15%, 20%, and 25% to 24%, 36%, and 54%, which is more than double the previous rate.
Given the consumer profile reflected in the statistics and the experiences of neighboring countries in the region, the Vietnam Tax Consultants Association suggested maintaining the special consumption tax rate for double-cabin pickup trucks at the level specified in the current Law.
The Vietnam Chamber of Commerce and Industry (VCCI) stated that the draft law’s proposal to increase the tax rate for double-cabin pickup trucks is not truly aligned with the overall context of the automobile market at present.
“Pickup trucks with double cabins are primarily used for cargo transportation, small-scale business operations, and official duties of government agencies, especially in areas outside urban centers,” VCCI clarified.
VCCI emphasized that a quantitative analysis indicates that increasing the special consumption tax rate for this type of vehicle could lead to several negative consequences. These include a reduction in state budget revenue (estimated at VND 7.7 trillion in the 2024-2030 period), a significant drop in vehicle consumption (a decrease of 36%), and challenges for businesses that have already invested in expanding their production.
Additionally, the cost of investing in new vehicles will increase, limiting the accessibility of enterprises and individuals with genuine needs. This policy could also undermine the effectiveness of the government’s goals regarding tax policy balance across vehicle types, environmental protection, and urban traffic management.
Therefore, enterprises proposed maintaining the current special consumption tax rate for double-cabin pickup trucks to ensure market stability, support businesses, and sustain state budget revenue.
Minh Chien
– 09:56 09/03/2025
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