The Ministry of Industry and Trade (MoIT) has proposed that the Ministry of Finance cut registration fees for locally-assembled or manufactured motor cars by 50 per cent, to support the domestic automobile industry.

It also suggested an extension to consumption tax payments for domestically-made and assembled cars, to boost consumption.

The MoIT said the government applied a 50 per cent cut in registration fees in 2021 and 2022 to help the automobile market overcome difficulties caused by Covid-19.

The policy had a positive effect, helping manufacturers recover and gradually expand production, thus contributing to boosting economic development and ensuring social security by generating jobs.

However, entering 2023, while businesses have yet to fully recover from the pandemic, they still face many difficulties due to the economic downturn, according to the MoIT.

High inflation and high interest rates have also forced people to cut spending, particularly on high-value items like automobiles.

Figures from the Vietnam Automobile Manufacturers Association show that car sales fell sharply in the first quarter of the year. Major auto manufacturers sold 77,090 motor cars, down 30 per cent year-on-year.