Vietnam plans to extend a special consumption tax cut on electric vehicles by nearly four years to the end of 2030 in a bid to boost EV sales and reduce emissions, the parliament office said over the weekend.
The government will submit the proposal to extend the tax cut to parliament for approval, the office said in a statement, citing a report from the finance ministry.
Vietnam cut the special consumption tax on EVs in March 2022 to a range of 1%-3%, from the previous level of 4%-11%. The cut is set to end in February 2027.
Annual EV sales in Vietnam skyrocketed from nearly 7,000 in 2022 to nearly 175,000 last year following the tax cut, it said.
This has contributed to Vietnam’s 2050 net zero target, it said, noting that each EV helps reduce carbon dioxide emissions by 0.85 metric tons a year compared to vehicles using internal combustion engines.
“Continuing to apply tax incentives for electric vehicles could generate a range of positive impacts, helping accelerate the shift toward cleaner-energy transport, reduce emissions and improve air quality, particularly in major cities,” the report said.
Reuters
