How much are cars taxed in Vietnam?

Taxation of Automobiles in Vietnam

Vietnam’s automotive industry is heavily regulated, with substantial taxes imposed on imported vehicles. This taxation scheme has a significant influence on car ownership costs in the country.

Special Consumption Tax (SCT)

Imported automobiles are subject to a substantial Special Consumption Tax (SCT) in Vietnam. The SCT rate varies depending on the vehicle’s engine displacement and fuel type. The SCT rates for passenger cars are as follows:

• Engine displacement up to 1.5 liters: 35%
• Engine displacement between 1.5 and 2.0 liters: 45%
• Engine displacement between 2.0 and 2.5 liters: 50%
• Engine displacement above 2.5 liters: 60%

Other Taxes

In addition to the SCT, imported vehicles are also subject to other taxes, including:

• Value-Added Tax (VAT): 10%
• Import duty: 5%
• Registration fee: Varies depending on the vehicle’s value

Exemptions for Diplomats

Diplomats enjoy an exemption from the SCT when importing vehicles into Vietnam. This exemption is a significant perk of their diplomatic status, as it significantly reduces the cost of owning a car.

Impact on Car Ownership Costs

The high taxes on imported automobiles have a substantial impact on the cost of owning a car in Vietnam. For example, a mid-size passenger car with an engine displacement of 2.0 liters would incur the following taxes:

• SCT: 45% of the vehicle’s value
• VAT: 10% of the SCT value
• Import duty: 5% of the vehicle’s value
• Registration fee: Approximately 1% of the vehicle’s value

As a result of these taxes, the total cost of owning a mid-size passenger car in Vietnam would be approximately 70% higher than the vehicle’s original purchase price.

Conclusion

Vietnam’s taxation system for imported automobiles significantly increases the cost of car ownership in the country. However, diplomats enjoy an exemption from the SCT, which reduces the cost of owning a car for them. This exemption is a valuable perk of their diplomatic status.