According to Minister of Finance Huynh Duc Phoc, combating increasing inflation is a vital responsibility this year as fuel and material prices rise and global economies recover.
He told the National Assembly on Thursday that one important objective in attaining this aim is raising the productivity of local businesses, which will assist enhance product value and ultimately raise people’s income.
One strategy Vietnam might use to reduce inflation is to raise taxes on fuel. However, he added, if Vietnam’s gasoline prices are significantly lower than those of other nations, this could encourage the smuggling of gasoline.
He said, “Vietnam’s tariffs are VND11,000 less than Laos’ and VND3,000 less than Cambodia’s.” Gasoline would flood to other nations if we weren’t attentive when our prices were low.
According to Phoc, fuel taxes in Vietnam only make up about 30% of the price of gasoline, compared to 45–60% in other nations.
Increased capacity at domestic refineries Nghi Son and Dung Quat would be the more crucial answer. said Phoc.
With the Russia-Ukraine situation and increased global demand for materials and ingredients following two years of COVID-19, inflation has been a key concern for lawmakers and government leaders this year.
Inflation in Vietnam reached 2.25 percent in the first five months, compared to 1.29 percent during the same period the previous year.
In contrast to the government’s goal of maintaining inflation under 4%, Standard Chartered predicts that full-year inflation will be 4.2 percent in 2022 and 5.5 percent in 2023.
The previous year saw the lowest inflation in six years, at 1.8 percent.
Source: VnExpress
