EV registration fees may be exempted for additional two years
EV registration fees may be exempted for additional two years
The Ministry of Finance has proposed extending exemptions for electric vehicle (EV) registration fees until 2027, instead of the current deadline this month.
The Ministry of Finance (MoF) is seeking comments on the proposal.
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In 2022, EVs started to receive preferential registration fees for five years, including a 100 per cent exemption for the first three years and a half reduction for the next two years. That means, by February 28, EV buyers will no longer be exempt and will have to pay 50 per cent of this fee. Meanwhile, hybrid cars do not have similar incentives.
In the draft decree, the MoF proposed extending the exemption for EVs by two years, until February 28, 2027.
The MoF explained that EVs contribute significantly to reducing greenhouse gas emissions. EVs in Vietnam contribute to the reduction of 0.5 million tonnes of CO2 equivalent per year. This emission reduction level may increase with EV sales forecast to grow by 25-30 per cent annually.
"Extending zero registration fees for EVs will develop the market, create jobs, increase income for workers, and promote economic growth," the MoF stated in the draft.
However, exempting registration fees for another two years could reduce the budget revenue by about VND4.8 trillion ($192 million) per year.
In the past three years, the loss was nearly VND8.42 trillion ($337 million). The number of EV sales has increased rapidly, from an average of over 400 per month in 2022 to more than 6,600 in 2024.
Currently, the registration fee for cars is calculated based on model and locality. For example, the first registration fee for cars in Hanoi, Quang Ninh, and Haiphong is 12 per cent of the car's value. In Ho Chi Minh City it's 10 per cent, and in Ha Tinh it's 11 per cent. For pickup trucks, the registration fee is 60 per cent of the fee for cars. From the second registration payment, the fee is 2 per cent across the country.
Along with solutions to exempt and reduce registration fees, the Ministry of Industry and Trade has set a target that by 2030, the proportion of EVs, hybrid cars, and green cars (using solar energy, biofuels, or other green fuels) will account for about 18-22 per cent of total market sales, equivalent to 180,000-242,000 units.
