The reference price list provides information on average price levels for car imports which customs agencies refer to to find out if importers are declare wrong prices to evade tax.
VietNamNet Bridge – After the General Department of Customs (GDC) released their updated reference price list showing car prices up 3-20 percent, importers have raised sale prices by 3-5 percent.
Many car importers in Hanoi and HCM City last week began quoting new sale prices, higher by 3-5 percent over the previous levels, reasoning that they have to pay higher tax because of higher taxable prices set by GDC.
The sharpest price increases have been applied mostly to medium class cars which have suffered most from the GDC’s newly revised reference price list.
Meanwhile, other models, including Matiz, Hyundai Getz, Daihatsu Terios, Honda Fit and Kia Morning have seen price increase by between several hundred dollars and several thousand dollars. The price of luxury and super-luxury cars have increased inconsiderably.
A director of a car import company in Hanoi, which specializes in cars from South Korea and Taiwan, said car price increases are inevitable, adding that 3-5 percent car price increases are still lower than the tax increases.
“However, we dare not raise sale prices too sharply. We still need to listen to the news,” he said.
A car importer in HCM City said the new reference price list will affect imports from South Korea and Taiwan most which have the prices of $20-30,000. As for luxury models, which have the prices of $100,000 and higher, the price increases of several thousand dollar will make no difference.
The importer said import car sales have been decreasing since late last week, though car showrooms have still been receiving a lot of visitors. He said that he receives some 25 visitors per day and sells two cars per day. That’s just half of the previous month and ¼ of the same period in 2008.
In principle, car sales always increase in the last three months of the year, as Vietnamese people want to purchase cars to drive at Tet. Before the GDC’s reference price list was released, car dealers hoped sales would increase by 30-40 percent. However, they now say that the forecast price increase may not occur.
“Consumers have delayed their purchases because they see prices increasing. They do not rush to purchase cars right now to enjoy tax and fee preferences any more,” the importer said.
Prior to that, analysts also warned that the car sales will decrease after December 31, 2009, when VAT and ownership registration tax preferences terminate.
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