VnnNews – Automobile manufacturers are worried about the future and urging the Government to extend the demand stimulus policy, set to expire on December 31, 2009.
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Akito Tachibana, Director of Toyota Vietnam and Chairman of VAMA, in a petition sent to the Ministry of Industry and Trade (MOIT), admitted that the 50 percent value added tax (VAT) reduction (since February 1, 2009) and the 50 percent ownership registration tax reduction (since May 1, 2009) both have helped the automobile market warm up.
Local newspapers have reported that automobile manufacturers do not have enough cars to deliver and that many sales agents have stopped signing contracts for delivery in 2009.
However, the chairman, in the document, warned that if the tax preferences ended on December 31, 2009 as previously planned, the automobile market would be severely hit as car prices would increase again.
Prior to that, automobile manufacturers in the world’s three biggest markets, the US, Japan and China, also expressed worries that their automobile industries would not be able to overcome difficulties if car demand stimulus policies were terminated at the end of the year.
Maintaining tax preferences is the solution?
“When a storm is over, it is time to do things to settle the problems caused by the storm,” said Pham Huu Tam, Director of HCM City-based Tradoco, a car dealer.
“If the Government thinks that automobile manufacturers have made enough money already and they don’t need more support, the automobile market will meet new difficulties,” he added.
Manufacturers, importers and consumers all support the extension of the tax preferences for the automobile industry. However, only the Government has the right to decide whether to maintain the policies.
Meanwhile, manufacturers need to know the Government’s decision as soon as possible, so that they can set up their business plans.
They have been trying to persuade the Government that 2010 is when the national economy will begin recovering, and one should not expect to see the economy growing as fast as it did in the pre-crisis period.
Economists also agree that it is necessary to continue tax preferences, but have suggested that it is necessary to reconsider the levels of preference.
VietNamNet/LD
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