Reporter: Dear Minister! In recent times, especially from 2020 to present, not only international organizations but also domestic economic experts, the business community and people believe that we have flexibly and effectively combined macroeconomic policies, especially fiscal policies to support people and businesses to overcome difficulties, helping the economy recover soon. Could you share more about this content?
Comrade Ho Duc Phoc: In 2023, the financial and budgetary tasks will be implemented in a context full of difficulties and challenges. However, thanks to the participation of the entire political system, the proactiveness, positivity, efforts and determination in the direction and administration of the Government and the Prime Minister; especially the proactive flexibility in operating fiscal policies with the goal of taking national and ethnic interests as the highest goal, Vietnam's economic situation has had positive changes and is still a bright spot in the gray picture of the world economy. The macro economy has been maintained stable, inflation has been controlled, growth has been promoted, and major balances of the economy have been ensured.
Firstly, regarding fiscal policy, it must be affirmed that, not only in 2023, but also in the 2020-2022 period, the Ministry of Finance has proactively researched, proposed, submitted to competent authorities as well as issued under its authority solutions in the financial sector, especially solutions on extending, exempting and reducing taxes, fees, charges and land rents (such as extending value-added tax, corporate income tax, personal income tax, special consumption tax and land rent; exempting and reducing corporate income tax, personal income tax, value-added tax, import tax, environmental protection tax, along with many fees, charges and land rents to support businesses, people and the economy.
Accordingly, the Ministry of Finance has submitted to competent authorities and issued under its authority 56 legal documents (including: 11 Resolutions of the National Assembly, the National Assembly Standing Committee; 18 Decrees of the Government; 2 Decisions of the Prime Minister; 25 Circulars of the Ministry of Finance).
The scale of Vietnam's support solutions in 2020 is about 129 trillion VND, in 2021 about 145 trillion VND, in 2022 about 233 trillion VND.
In 2023, in the spirit of accompanying businesses and people to overcome difficulties to recover and develop the economy, the Ministry of Finance will continue to submit to competent authorities and issue support policies under its authority with a scale of about 200 trillion VND. Particularly in the 2022-2023 period, it is necessary to mention the focus of economic recovery policies is the Government's economic-financial stimulus package worth 347 trillion VND, including a fiscal policy package of about 291 trillion VND (including policies to exempt and reduce taxes, fees and increase investment spending for economic development).
Some typical financial support policies include: The Ministry of Finance has submitted to the Government and the National Assembly a 2% reduction in value-added tax rate from July 1, 2023 to December 31, 2023 for most items currently subject to a 10% value-added tax rate.
The Ministry of Finance has submitted to the Government to submit to the National Assembly Standing Committee to issue Resolution No. 30/2022/UBTVQH15 dated December 30, 2022 on environmental protection tax rates for gasoline, oil, and grease, effective from January 1, 2023 to December 31, 2023. It is expected that the implementation of this Resolution will reduce the State budget revenue by about VND 38 trillion; submit to the Government to issue Decree No. 12/2023/ND-CP dated April 14, 2023 extending the deadline for payment of value added tax, corporate income tax, personal income tax, and land rent in 2023 for enterprises, organizations, business households, and business individuals. Accordingly, the estimated amount of tax and land rent to be extended is more than VND 110 trillion.
At the same time, submit to the Government for promulgation Decree No. 36/2023/ND-CP dated June 21, 2023 on extending the deadline for payment of special consumption tax payable arising from the tax calculation period of June, July, August and September 2023 for domestically manufactured and assembled automobiles. It is expected that implementing this solution will extend about VND 10.4 trillion - VND 11.2 trillion.
On the other hand, the Ministry of Finance has submitted to the Government Decree No. 41/2023/ND-CP dated June 28, 2023 on reducing registration fees for domestically manufactured and assembled automobiles. It is expected that implementing this solution will reduce the State budget revenue by about VND 8,000 billion - VND 9,000 billion. Along with that, Circular No. 44/2023/TT-BTC dated June 29, 2023 on reducing the collection of 36 fees and charges to support and reduce costs for businesses and people. It is expected that implementing this solution will reduce the State budget revenue by about VND 700 billion.
Most recently, the Ministry of Finance submitted to the Prime Minister Decision No. 25/2023/QD-TTg dated October 3, 2023, reducing 30% of land and water surface rent payable in 2023 for land and water surface renters. It is expected that by implementing this solution, the amount of land rent to be reduced in 2023 will be about 3.5 trillion VND. It is expected that implementing the above solutions will support businesses and people with a value of tax and land rent of about 200 trillion VND, of which: The amount extended is about 121 trillion VND; The amount of tax, fees, charges and land rent exempted or reduced is about 79 trillion VND.
Thus, in the past time (2020-2023), the fiscal support package for State budget revenue has reached about 700 trillion VND, contributing to supporting businesses and people to overcome difficulties, stabilize production and business activities to contribute to positive results in socio-economic development.
In that context, to ensure the estimated State budget revenue target, the Ministry of Finance has implemented synchronous solutions to strengthen management, exploit revenue sources, prevent revenue loss from e-commerce activities, cross-border digital platform business, real estate transfer activities through implementing the e-commerce information data portal for foreign suppliers, supporting foreign suppliers to register, declare, and pay taxes in Vietnam quickly and conveniently; activating the e-commerce information data portal to receive information from organizations and individuals doing business on the platform from e-commerce trading floors; deploying electronic invoices generated from cash registers. The total amount of tax paid from foreign suppliers in the 11 months of 2023 reached more than 8 trillion VND.
In the coming time, along with the drastic and effective implementation of the tasks and support solutions that have been issued, the Ministry of Finance will continue to closely monitor the actual situation to study and propose solutions applicable for 2024 such as: Continuing to consider reducing the environmental protection tax rate as applied in 2023; Continuing to consider reducing the value added tax rate as applied in 2023; Continuing to review export and import tax rates to support domestic production and business;... In 2024, the scale of tax exemption and reduction policies to support people and businesses is expected to be about 65 trillion VND.
Comrade Ho Duc Phoc: It is also necessary to add that the above policies to support people and businesses also have a significant impact on the State budget revenue. However, these are necessary solutions in the short term. To ensure the budget estimates for political, economic and social goals, the Ministry of Finance has also synchronously implemented many other solutions since the beginning of the year.
Reporter: It can be said that the above support policies have helped businesses and the economy have resources to recover. In addition, a series of other solutions have also been deployed to stabilize the macro economy and control inflation. What are those solutions, sir?
The Ministry of Finance has submitted to the competent authority for decision the estimate of the State budget deficit in 2023 at 4.42% of GDP. During the management process, the deficit has been strictly controlled, borrowing and issuing Government Bonds in accordance with the revenue progress, the ability to disburse investment capital and the State budget balance, thereby saving interest costs for the State budget. The estimated State budget deficit is about 4% of GDP (a decrease of VND 40.3 trillion compared to the estimate).
In 2024, the State budget deficit estimate submitted to the National Assembly for decision is at an appropriate level of 3.6% of GDP; at the same time, it is allowed to extend undisbursed development investment expenditures in 2023 to ensure resources for development investment expenditures.
Regarding public debt control, the current public debt scale is about 3.9 million billion VND, equivalent to about 39-40% of GDP (ceiling not exceeding 60%). The growth rate of public debt in the 2021-2023 period is about 4.2%/year, a sharp decrease compared to the 2011-2015 period (18.1%/year), the 2016-2020 period (6.7%/year). Government debt is about 3.6 million billion VND, equivalent to about 36-37% of GDP (ceiling not exceeding 50%). The Government's direct debt repayment obligation in 2023 is about 279.8 thousand billion VND, equivalent to about 20-21% of State budget revenue, ensuring within the ceiling limit of not exceeding 25%. The average issuance term of Government Bonds is expected to be about 12.6 years in 2023 (ensuring the target of striving for the average issuance term of Government Bonds to reach 9-11 years according to Resolution of the National Assembly No. 23/2021/QH15). The average issuance interest rate of the entire Government Bond portfolio is expected to be about 3.7-4%/year in 2023.
Thanks to the synchronous and proactive implementation of solutions, domestic market prices, especially those of important and essential goods, have been basically stable, meeting people's needs. The average CPI increased by only 3.2% compared to the same period last year, aiming to achieve the target set by the National Assembly and the Government for the whole year (about 4.5%). This is a relatively low CPI increase in the current context.
One of the tasks to stabilize the macro economy, ensure major balances, and promote growth is to improve the law, remove difficulties and obstacles for production and business, and promote the disbursement of public investment capital. The total public investment capital in 2023 approved by the National Assembly is VND 711,684 billion, an increase of 22.7% compared to 2022. Of which, the majority of capital flows are focused on urban projects, especially the North-South high-speed railway; expressways, regional connectivity, coastal roads, and national target programs. With the strong direction from the Government and the Prime Minister, many difficulties in mechanisms, policies, and implementation organization related to the disbursement of public investment capital have been resolved.
From the perspective of the Ministry of Finance, to promote the disbursement of public investment capital, the Ministry of Finance has had many drastic solutions. The Ministry of Finance continues to closely follow the direction of the Government and the Prime Minister, synthesize reports from ministries, branches and localities to handle within its authority or submit to competent authorities to handle problems and difficulties related to the disbursement of public investment capital.
Regarding the 2024 budget, the National Assembly approved the 2024 development investment expenditure estimate of VND 677,349 billion. The Ministry of Finance has included in the Circular regulating the implementation of the 2024 State budget estimate and proposed to include in the Prime Minister's Decision on assigning the 2024 budget revenue and expenditure estimates the contents requiring ministries, central agencies and localities to immediately implement a number of contents to speed up the disbursement progress right from the first months of the year.
However, we also believe that in order to "unblock" the flow of public investment capital, creating real momentum for socio-economic development in 2024 and the following years, we cannot only focus on solving immediate problems, but need fundamental, long-term solutions, such as focusing on amending and perfecting legal regulations, including amending the Law on Public Investment in a transparent and less complicated direction, such as separating the site clearance part for implementation first, decentralizing investment management, and further studying cases where investors can proactively use some legal funds outside the medium-term public investment plan (including regular expenditure sources) to establish projects and prepare for investment in advance, instead of having to wait for synthesis or addition to the medium-term public investment plan; or it is necessary to remove the content of renovating projects that have been invested in and constructed from the public investment objects to increase the initiative of units and effectively implement many other solutions to increase total investment demand.
PV: Thank you very much, Minister!
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