Vietnam will allow the import of used vehicles less than five years old and will charge duties of between $3,000 to $25,000 per vehicle depending on the engine size, state media reported on Wednesday.
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According to Reuters, the Tien Phong newspaper said prime minister Phan Van Khai had decided to end a ban on the import of used automobiles with 15 seats or fewer from May.
Used cars with engines under 1,000 cc will carry the lowest duty of $3,000 while the duty on a car with an engine bigger than 5,000 cc would be $25,000.
They will also be subject to a special consumption tax of 50% and a value added tax of 10%, Reuters said.
People have been delaying purchases to compare prices of locally-assembled and imported vehicles, the news agency noted, adding that sales by 11 foreign-backed automakers in Vietnam, including Toyota, Ford, GM Daewoo and Mitsubishi, dropped 21% in the first two months of this year from a year earlier to just 2,984 vehicles.
Reuters said the communist country’s per-capita income remains one of the world’s lowest at around $500, but its car prices are among the highest due to high tariffs and taxes. A Toyota Camry sells for around $60,000 compared to around $20,000 in Japan.
