Depositing nearly 7.8 million billion VND in temporarily idle budget, earning more than a billion USD in bank interest

The above information was stated by the Ministry of Finance in the Submission of the Decree amending and supplementing Decree No. 24/2016/ND-CP dated April 5, 2016 of the Government regulating the state budget management regime.

By October 31, 2023, the Ministry of Finance had contributed VND 19,078.6 billion to the state budget from managing idle funds.

According to the Ministry of Finance, temporarily idle state funds have been used effectively, in accordance with the order of priority. One is to lend to the state budget to cover the budget deficit, repay principal and make advances to the budget when revenue sources have not been collected in time; make term deposits at commercial banks with high safety levels according to the principle of competitive bidding on interest rates and term buyback of government bonds (TPCP).

Specifically: The Ministry of Finance has used the state budget to lend to the central budget with a total new loan of more than 208,000 billion VND. From there, it has promptly met the balancing needs of the central budget in the context of the central budget restructuring its debt towards reducing foreign debt and increasing mobilization from domestic loan sources. At the same time, it has reduced the borrowing costs of the central budget and supported the issuance of government bonds when the market faces unfavorable factors.

The Ministry of Finance has used the state budget for local budget advances with a total of more than VND 5,600 billion of state budget; thereby, helping localities fully meet payment and disbursement needs when revenue sources have not been collected in time.

The Ministry also deposited temporarily idle state funds at commercial banks with a total deposit value of more than VND 7.79 trillion; the interest earned from term deposits was nearly VND 25,100 billion (about VND 18,100 billion higher than the case of only depositing without a term at the State Bank of Vietnam ).

The temporarily idle state budget was also used to buy back government bonds with a total transaction value of VND 7,000 billion; the interest earned was VND 6 billion.

"Through effective management of the state budget, by October 31, 2023, the Ministry of Finance has contributed VND19,078.6 billion to the state budget," the Ministry of Finance said.

Personal income tax has decreased for the first time in 10 years, but still collected over hundreds of thousands of billions . In the past 10 years, this is the first year that personal income tax revenue in the 3 quarters of the year has had negative growth. But personal income tax is still a large revenue in the total budget revenue.

Source