Vietnam has slashed environmental protection taxes on petrol, aviation fuel and diesel to zero from March 27, 2026, under an urgent decision by the Prime Minister, aimed at stabilizing the market and ensuring energy security.

The measure, outlined in Decision No. 482/QD-TTg issued by the Prime Minister on March 26, will remain in effect until April 15, 2026.

Under the decision, the environmental protection tax on petrol (excluding ethanol), diesel and aviation fuel has been reduced to VND0 per litre. These products are also exempt from value-added tax (VAT) during the period, although input VAT remains deductible. In addition, the special consumption tax on petrol has been cut to 0% also.

The Ministry of Finance described the move as an emergency response to rising global energy prices, driven by escalating tensions in the Strait of Hormuz that have pushed crude oil prices above $100 per barrel.

During the implementation period, businesses and importers of petrol, diesel and aviation fuel will not be required to declare or pay VAT at either the import or sales stages.

The Government expects the temporary tax cuts to help ease cost pressures, stabilize domestic fuel prices and support economic activity.