The State budget would lose VND1 trillion ($46.948 million) if the global oil price is reduced by $1. -- File Photo

HA NOI (Biz Hub)— The finance ministry on Thursday increased the maximum preferential import duty on oil and petrol by 10 to 15 per cent to touch 40 per cent.

This is to compensate for the State budget's loss in the wake of a sharp drop in oil prices in the global market. Viet Nam is a crude oil exporter with an export volume of 1.3 million tonnes last year.

Under directive 17728/BTC-CST, the highest import duty will be imposed if the petrol, kerosene, diesel and mazut prices listed by Platt in the Singapore market are below US$60 per barrel within 15 days on average before the tariff revision day.

When Platt's price is between $60 and $75 per barrel, the maximum import duty will be 35 per cent on petrol and kerosene, and 30 per cent on diesel and mazut.

The import duty will be reduced to 25 per cent for petrol and kerosene, and by 20 per cent for diesel and mazut, if Platt's prices fluctuate around $75 to $95 per barrel.

The lowest import duty of 15 to 20 per cent will be imposed when a barrel of fuel costs more than $95.

According to the previous regulations, the maximum preferential import duty on petrol and gasoline was only 30 per cent if the product's price in the Singapore market was $45 to $60 per barrel. The rate for diesel and mazut was only 25 per cent.

According to the ministry, the maximum preferential import duty is among the references for the ministry to consider issuing guidelines on the detailed import duties on petrol and oil products.

Domestic petrol and oil importers often depend on the duty to build their business plans.

The oil price in the global market has dropped sharply from $105 per barrel in late July to $68.53 late last month, the lowest in the past four to five years.

Minister of Government Office Nguyen Van Nen said at a recent press conference that the State budget would lose VND1 trillion ($46.948 million) if the global oil price is reduced by $1. — VNS