The Ministry of Finance (MoF) has proposed to reduce registration fees by 50% for domestically-produced and assembled cars for six months, from August 1.

Under the ministry’s draft decree on registration fee reduction for domestically manufactured and assembled automobiles, the fees would be cut by half from August 1, 2024 through January 31, 2025.

The move is expected to help promote consumption and support the domestic automobile industry as car sales have dropped drastically.

Pressures from inflation, exchange rates and gold price hikes have negatively affected consumers’ psychology, resulting in their tightening expenditure on high value products like cars, according to the MoF.

According to the MoF, the cut will reduce State budget collections by VND867 billion ($34 million) per month.

From February 1, 2025, the registration fee will continue to be governed by Decree 10/2022/NĐ-CP and current resolutions of the provincial/municipal People's Councils or decisions of the provincial/municipal People's Committees on registration fee rates in localities.