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[February 2009]
Vietnamese Tax Reduction Leads to Fall in Prices
VNS (HCM City, Vietnam) reports this week that the decisions to allow deferment of tax payment and to reduce value added tax (VAT) on 18 categories of commodities has prompted prices of many goods and services to fall soon after these measures came into effect on 1 February 2009.
Apparently, many enterprises nationwide have announced prices cuts of between 2% and 6% over the last several days.
Eighteen categories of commodities now enjoy a 50% VAT reduction, including wholly-assembled cars and car components, engines, gear boxes, coal, basic chemicals and hotel and tourism services.
Hoang Quoc Tuan, the Deputy Director of the Dong Nai Brick & Tile Co, said that thanks to the tax reduction, tile companies would not have to spend time and money on measures to boost sales in a difficult period.
Customers would also benefit as they will not have to spend as much money to buy products, he said.
The reduction of VAT from 10% to 5% has seen the prices of perforated bricks go down from VND 1,100 to VND 1,045 each (roughly US 6 cents). The price of ceramic tiles has decreased from VND 6,800 to VND 6,460 each (roughly US 37 cents).
ENDS