The decree, signed by Prime Minister Nguyen Xuan Phuc on Sunday, which determines the registration fee for cars produced in Vietnam, would be in effect until December 31.

First-time registration fees for locally made cars, trailers and semi-trailers towed by cars, among others, would be cut by half. From January 1, 2021, the fee will be back to the old level.

Registration fees were previously 12 percent of the car price in localities like Hanoi, Hai Phong City and Quang Ninh Province, 10 percent in Ho Chi Minh City and 11 percent in the central province of Ha Tinh, for instance.

The move is part of an effort to boost car sales, which plummeted in the first four months of this year due to the impact of the Covid-19 pandemic, and auto brands might consider lowering prices of imported cars to compete, analysts said.

Auto sales fell 36 percent year-on-year in the period to 64,100 units, of which 63 percent were domestically made, according to the Vietnam Automobile Manufacturers Association.