Annual fee on private vehicles not feasible: Experts

Several experts are of the opinion that high ownership fees on private vehicles, as proposed by the Ministry of Transport, will only increase financial burden on residents and unlikely to resolve traffic congestion problems.

A toll station on HCMC-Trung Luong Expressway (Photo: SGGP)

The Ministry of Transport has submitted a proposal to the Government to charge an annual ownership fee on private vehicles in the country.

Lawyer Thai Van Chung, general secretary of the Ho Chi Minh City Cargo Transport Association agreed the new fee was necessary but far too high.

However, the fee charges should be calculated reasonably as private vehicles already have many overhead costs. The fee proposed by the Ministry of Transport seems too high and will be an unnecessary financial burden on residents, added Mr. Chung.

He also thought that instead of charging VND20-50 million a year for a car ownership, the ministry should simply increase registration fees, which will make residents reconsider before they purchase a new vehicle.

Dang Duc Tiep, director of Dang Tien Transport Service Company said that collection of ownership fee is not feasible and will not help in reducing traffic congestion, as residents need vehicles for travelling and doing their daily business. If they can spend billions of dong to purchase a vehicle, they will also pay up any extra fees.

He also agreed that the new fee will bring more financial burden for residents. For instance, transport companies like taxis will have to increase their service charges to make up the costs, and the final payers will be the residents.

Mr. Tiep proposed not to charge an annual ownership fee but to collect on mileage per vehicle, the more mileage the higher the fee.

Nguyen Huu Nguyen from the Southern Centre for Economic Research said that ownership fee on private vehicles is not practical, will not reduce traffic jams, and residents will continue to use their vehicles regardless.

Besides, if one has to pay every time to enter the city centre, residents will choose other routes to enter, which might cause further traffic jams along new road spots.

According to Mr. Nguyen, the Government should not focus on levying fees but work at improving and upgrading the traffic infrastructure.

Businesses propose slash in road maintenance fee

The Hanoi Transport Association has proposed to the Ministry of Transport to cut down on the 40 per cent road maintenance fee, proposed by the ministry, said Bui Danh Lien, chairman of the association.

According to Lien, the Government should postpone the implementation of the road maintenance fee until January next year.

He was speaking at a meeting between the association and businesses on Thursday, to discuss measures to resolve difficulties faced by businesses, as the Ministry of Transport prepares to collect road maintenance and private vehicle ownership fees from Thursday.

Most businesses said that collection of both the above fees would add to their difficulties.

By Dinh Ly – Translated by Hai Mien

Other news