The ministry of finance has sought feedback on a draft resolution to cut tax on petrol (excluding ethanol) and aviation fuel from VND 2,000 (about USD 0.076) to VND 1,000 per litre, and on diesel from VND 1,000 to VND 500 per litre.
The reduced rates would apply from the resolution’s issuance until June 30, 2026, including any extension if required. After that, taxes would revert to levels set under existing regulations.
Authorities said environmental tax currently accounts for about 6.7 per cent of the base price of fuel. With global prices fluctuating, the proposed reduction is seen as a measure to stabilise the domestic market.
A full tax exemption would require approval from the national assembly, so the proposal instead applies the lowest rates within the authority of its standing committee.
The ministry of finance estimates the cuts could reduce state budget revenues by around VND 1.79 trillion (about USD 68 million) per month, including lower value-added tax receipts.
However, officials said the measure is needed to ease input costs, support businesses and households, and stimulate economic activity while maintaining macroeconomic stability.