Vietnam offers tax incentives, exemption of registration fees for electric cars, many countries support the money to buy a car

The National Assembly has officially passed the Law on Special Consumption Tax. Specifically, the excise tax rate for electric vehicles will be reduced by up to 12% compared to the current rate.

This tax cut is aimed at attracting investment in industries related to eco-friendly electric vehicles. From there, promote production, business and consumption. This special priority policy will create impetus for VinFast – the first automobile manufacturer in Vietnam to develop stronger electric vehicle orientation.

The excise tax and its duration apply to electric vehicles.

For cars with less than 9 seats, the tax will be reduced to the deepest 12% from 15% to 3% in the period of March 1, 2022 – February 28, 2027. After that, the excise tax will increase to 11% from March 1, 2027.

In addition, the Prime Minister has issued a Decree stipulating the registration fee for electric cars. Specifically, within 3 years from March 1, 2022, the first registration fee for battery-powered electric cars will be 0%. For the next 2 years, the first registration fee is equal to 50% of the charge for petrol and diesel cars with the same number of seats.

Thus, in the next 3 years, when buying an electric car, there will be no need to pay registration fees and be applied a very preferential tax rate.

Not only Vietnam, there have been many countries around the world with tax incentives for electric vehicles to promote sustainable development. In China, specifically, electric vehicles are classified in the category of the new energy vehicle industry. Electric vehicles will be tax-free from January 1, 2021 to December 31, 2022.

In addition, Belgium once exempted the registration tax for electric vehicles in 2020. Or Germany reduced the tax from 19% to 16% for electric vehicles. Along with that is Italy, which is exempt from registration tax for the first 5 years after buying a car, then will receive a 75% reduction in the equivalent tax rate for petrol cars. Along with that, the US has provided tax incentives for electric vehicle products worth from $2,500 to $7,500, depending on battery capacity.

In addition, many countries around the world also subsidize electric vehicle buyers. Like the UK, it subsidizes 35% of the cost of an electric car up to a maximum of £3,000 depending on the model. In the Netherlands, a subsidy of 4,000 Euro is made when buying a new electric car. Italy subsidizes up to 6,000 euros for electric vehicles. As for Germany, hills with electric cars cost up to 40,000 euros, support electric cars up to 9,000 euros; for electric vehicles costing up to 65,000 euros, the subsidy is 7,500 euros.