Vietnam's motorbike parts importers shake their heads
HANOI - New tax regulations issued by the government have left
motorbike industry importers scratching their heads in puzzlement and
frustration.
First, in a bid to head off cheap imports, the tariff on motorbike parts
was hiked from 15-30 percent to 60, effective as of October 25. Those
motorbike makers and assemblers who had an ear to the ground, beat
the punch and increased imports of motorbike parts to huge levels in an
attempt to beat the deadline for the new tariff. According to industry
insiders, one speculator bought 26,000 motorbike complete parts in the
last few days before October 25.
But the General Department of Customs (GDC), getting wise to the
subterfuge, then issued another order on October 24, requiring
producers whose imports exceeded installed capacity to also pay the
new tariff. This has hurt most motorbike makers - even the ones that did
not try to get around the original deadline - as industry imports had
already exceeded production capacity.
According to the Ministry of Industry (MoI), while installed capacity is 1
million units annually, imports this year have already crossed 1.6 million
motorbike complete parts.
While an additional 30 percent tax on 600,000 motorbike complete
parts represents a windfall to the exchequer, the industry has been left
ruing what could have been.
"The MoI is the one to blame, not businesses, because every import
paper has been inspected and stamped by it," Bui Van Hai, production
manager at the New Technology Import & Export Company
(Nacenimex), told the Vietnam News.
Although the Ministry of Trade (MoT) nominates the import quotas, the
MoI is the one that assesses production capacities to issue import
licences, he said. However, according to Hai, collecting the additional 30
percent would be almost impossible as most of the motorbikes were
already sold.
But as a matter of caution, prices of Chinese bikes in the market have
been raised by US$30 to $50 pending resolution of the predicament.
Asia Times - November 9, 2001.
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