Russian cars subject to 0% tax

                                                             Photo: VnEconomy

Imports to be tax free from October 5 under quota regime.

A quota of Russia motor vehicles will be subject to a zero per cent tax rate when being imported into Vietnam from October 5.

According to a draft decision from the government, 800 Russian cars will be imported at zero per cent tax rates this year, 850 in 2017, and 900 in 2018, for around 2,500 in total.

The Ministry of Industry and Trade announced that the draft decision is based on the protocol for automotive cooperation between Vietnam and Russia, signed in March this year.

Exporters such as the New Atlantic International Trading Group (KAMAZ), Ulyanovsky Avtomobilny Zavod (UAZ) and others are authorized by Russia to cooperate with Vietnam in producing vehicles.

The vehicles will include SUVs, vehicles of ten seats or more, trucks and specialized vehicles, which will imported to gauge the tastes of Vietnamese customers.

The allocation of the yearly quota for each exporter will be based on their production plans and localization rates.

In order to be subject to the zero per cent tax rate, vehicles must meet origin rules and the requirements of the Vietnam - Eurasian Economic Union Free Trade Agreement.

Under the protocol for automotive cooperation, Vietnam also permits the import of 13,500 spare parts and accessories at a zero per cent tax rate for a period of five years.

Russia will also cooperate with Vietnamese enterprises to establish automotive joint ventures producing vehicles for Vietnam and for Asia.

According to the General Department of Customs, imported Russian motor cars and spare parts and components stood at $6.9 million and $338,340 in July and $61.7 million and $5.1 million in the first half of the year.

by Hai Van / vneconomictimes.com