The amended Resolution No 1269 on environmental taxation will, however, impose no extra duty on kerosene, as this is an essential commodity for the majority of poor people, and those living in underprivileged and mountainous areas.

Accordingly, the environmental tax levied on petrol (except for ethanol) and aviation fuel will increase from VND1,000 to VND3,000 (0.47 to 1.4 US cents) per litre; on diesel from VND500 to VND1,500 per litre; and on lubricating oil and grease from VND300 to VND900 per litre. The tax on kerosene will stay the same at VND300 per litre.

The increased revenues will be allocated to the State and local budgets this year.

On the second day of the ongoing NA Standing Committee session, members discussed a Government report that analysed the need for amendments to the resolution as well as the likely impacts of increased environmental taxes.

Committee members agreed with the report, saying the latest reductions in oil and gas prices have increased fuel use, thus damaging the environment further.

They also agreed with the argument that increasing the tax will help mitigate environmental pollution.

Another argument made for the increase was the need to curb cross-border fuel smuggling that was happening as a result of lower retail fuel prices in Viet Nam.

A Vietnam News Agency report said that the NA delegates also discussed the Government report on investment capital needed for the Tinh Phong – Dung Quat 2 Road in the central province of Quang Ngai; and another on using 70 per cent of visa fees collected to construct Viet Nam's representative offices abroad.