The Government has further extended the excise tax payment deadline for domestically-produced cars until November 20.

Car manufacturing at Vinfast's plant. Photo: Pham Hung

The move was part of the Government’s decree No.32, according to which tax payment for domestic cars bought during the June-September period would be extended until November 20.

This would be the third extension of the excise tax payment deadline for local cars since 2020, with the Ministry of Finance (MoF) expecting the amount subject to a tax break of VND20 trillion ($US$863 million).

Once the extended deadline is expired, payment for an excise tax on domestic cars would be reverted to normal.

The MoF previously put in place a 50% cut in the registration fee for local vehicles. Such support, along with this latest policy, is considered an urgent solution for the car industry to recover from severe pandemic impacts.

According to the MoF, turnover from an excise tax on locally manufactured cars was estimated at VND2.45-2.8 trillion ($107-122 million) per month. Assuming growing demand for electric vehicles in the coming time, the MoF expected a decline of VND2-3 trillion ($87-130 million) in state budget revenue or a drop of VND170-250 billion per month.

Firms eligible for the delay in tax payment deadline could either send the request in soft or hard copies to the tax authorities, noted the ministry.

The total excise tax amount subject to relief in October and November of last year stood at VND5.44 trillion ($237 million).