Resolution on reduction of environmental protection tax for fuel and lubricants adopted

The National Assembly Standing Committee (NASC), during its 50th session on October 17, unanimously agreed to reduce the environmental protection tax on gasoline, oil, and lubricants from the rates stipulated in Resolution 579/2018/UBTVQH14 dated September 26, 2018 (Resolution 579), as proposed by the Government.

The new tax rates to be applied in 2026 are as follows: For gasoline, excluding ethanol: VND2,000/liter; diesel oil, fuel oil, lubricating oil: VND1,000/liter; grease: VND1,000/kg; kerosene: VND600/liter.

As a result, the expected environmental protection tax revenue reduction in 2026 compared to the tax rates under  Resolution 579 is about VND41.388 trillion (over $1.57 billion). The total state budget revenue (including the value-added tax reduction) is therefore expected to decrease by approximately VND44.7 trillion ($1.7 billion).

This aims to promptly meet immediate and long-term needs, creating momentum for double-digit growth in the 2026-2030 period. Simultaneously, it contributes to stabilizing the domestic petroleum market amidst a still unpredictable international situation.

Specifically for jet fuel, an assessment showed that the implementation of the environmental protection tax reduction policy for jet fuel in recent times has had positive effects, helping to reduce input fuel costs for the aviation industry in general and air transport businesses in particular. This contributed to helping air transport businesses overcome the crisis caused by the Covid-19 pandemic and economic recession.

According to Deputy Minister of Finance Nguyen Duc Chi, in the context where Vietnam's aviation market has basically recovered, to continue supporting businesses in the aviation industry while ensuring fairness among other transport sectors such as rail, water, and road, the Government had proposed that the NASC set the environmental protection tax rate for jet fuel at VND1,500/liter.

The newly adopted Resolution will take effect from January 1, 2026, to December 31, 2026. From January 1, 2027, the environmental protection tax rates for gasoline, oil, and lubricants will revert to those specified in Resolution 579.