The National Assembly Standing Committee has approved environmental protection tax hike for oil and petroleum products from early next year.

Environmental protection taxes for petrol will be raised by VND1,000 to the celling level of VND4,000 per litre from the current level of VND3,000 (13 U.S. cents). 

Environmental protection taxes for petrol will be raised by VND1,000 to the celling level of VND4,000 per litre (Photo by Hai Nguyen)

The taxes for diesel oil will be raised by VND500 to VND2,000 per litre; meanwhile, the increase for other products will be from VND5,00-1,100 per litre.

The hike will be applied from January 1, 2019 to curb the consumer price index and maintain the country’s inflation rate at below 4% as set by the government.

The higher petroleum prices are forecasted to cause Vietnam’s CPI grow by 0.07 - 0.09% in 2019.

The National Assembly Committee for Finance and Budgetary Affairs also supported the environmental protection taxes for petroleum products, saying that the product prices are still lower than many regional countries. 

According to the National Assembly’s Deputy Chairman Phung Quoc Hien, the higher environmental tax income on petroleum products would help the state budget to increase by VND15.7 trillion (USD713.63 million).

National Assembly Chairwoman Nguyen Thi Kim Ngan said the extra funding would be spent on environmental protection activities.