HANOI, Feb. 23 (Xinhua) -- The Vietnamese Finance Ministry has proposed raising environmental protection taxes on oil and petroleum products from July 1 to increase tax collection by 15,684 billion Vietnamese dong (nearly 694 million U.S. dollars) a year.

Environmental protection taxes have been proposed to increase by 1,000 Vietnamese dong (over 4 U.S. cents) per liter of petroleum products to 4,000 Vietnamese dong, by 500 Vietnamese dong per liter of diesel oil to 2,000 Vietnamese dong, and by 1,100 Vietnamese dong per liter of other oil products to 2,000 Vietnamese dong, according to the ministry on Friday.

The tax hike is necessary because import taxes on oil and petroleum products are declining sharply, the ministry said, noting that the current import tax on petroleum products is 20 percent, and that on oil products is 7 percent, and the respective rates will be slashed to 10 percent and zero percent in line with Vietnam's tariff commitments.

According to the ministry, retail prices of oil and petroleum products in Vietnam are now lower than those in neighboring countries and many other Southeast Asian nations.

In January, Vietnam imported 900,000 tons of various kinds of oil and petroleum products totaling 552 million U.S. dollars, marking respective rises of 3.5 percent and 10.8 percent, according to the General Statistics Office.