Ulaanbaatar
Excise tax on hybrid cars to be refunded
Economy
Ulaanbaatar /MONTSAME/ During the Parliament’s plenary session on June 8, the first reading of bill on Excise tax procedural regulations was held.
In order to join the Extended Fund Facility program of the International Monetary Fund (IMF), amendments were made to the Excise Tax Law, resulting in excise taxes to be imposed on hybrid, natural gas and electric vehicles. Specifically, these types of cars, which had been exempt from excise tax, started paying taxes between MNT 375,000 and MNT 6,675,000 based on the vehicle's date of manufacture since May 1.
Due to the public’s dissatisfaction towards this decision and the country's current state of the economy, Procedural Regulations of Excise Tax Law, which states to create regulation for the Government to determine tax rates and refund the taxes back to tax payers, was submitted to the parliament.
In order to join the Extended Fund Facility program of the International Monetary Fund (IMF), amendments were made to the Excise Tax Law, resulting in excise taxes to be imposed on hybrid, natural gas and electric vehicles. Specifically, these types of cars, which had been exempt from excise tax, started paying taxes between MNT 375,000 and MNT 6,675,000 based on the vehicle's date of manufacture since May 1.
Due to the public’s dissatisfaction towards this decision and the country's current state of the economy, Procedural Regulations of Excise Tax Law, which states to create regulation for the Government to determine tax rates and refund the taxes back to tax payers, was submitted to the parliament.
During the discussion, the members clarified if any negotiations were made with the IMF on the aforementioned tax issues. In response, MP Ch.Khurelbaatar informed that an agreement was reached with the IMF. Furthermore, MP B.Batzorig said “Around MNT 1 billion will be required for the tax refund. Officials of the Ministry of Finance informed "Taxes of some 375 vehicles have been paid since May 1. However, around 2600 vehicles are still awaiting customs clearance”.
During the Parliament's plenary session on June 9, the Procedural Regulations of Excise Tax Law was approved by 87.7 percent of the total votes. Accordingly, excise taxes will be refunded back to the taxpayers with following conditions starting from June 9.
- If the excise taxes of an imported vehicle was paid before the Procedural Regulations of Excise Tax Law is adopted.
- If the excise tax of an imported vehicle was paid, but still hasn't been sold yet.
- If the imported vehicle was already changed ownership, the refund will be deposited to the current owner of the vehicle.
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