Fiscal policy is an important support for the economy before the Covid-19 pandemic

	Government considers reducing several taxes and fees
	The Ministry of Finance takes the initiative in fiscal measures to support the prevention and control of Covid-19
	Lowering operating interest rate with lags in support of economy

98% of enterprises, organizations, households and individuals engaged in production and business activities nationwide have been extended the payment of taxes and land rents. Photo: T.Linh

Saving recurrent expenditures

Regarding the prevention and control of the Covid-19 pandemic, the state budget cannot be lacking. Since the outbreak of the pandemic in neighboring countries, the Government has implemented preventive measures, and the Ministry of Finance prioritized VND16.2 trillion from the State budget to implement the regime and priority policy for the forces involved in the prevention of the Covid-19 pandemic; procurement of medical equipment, supplies and direct support for affected people, ensuring social security and safety.

Specifically, the central budget has spent about VND9.5 trillion to purchase medical equipment and supplies to prevent and control Covid-19. This number will continue to increase in the future to meet the requirements to enhance the ability to cope with this pandemic. In addition, about VND6.7 trillion has been spent on the regime of priority allowances for the forces engaged in the prevention and control of Covid-19; expenses for meals for isolated people, medical examination and treatment during the isolation period.

To ensure social security, the Ministry of Finance also proactively prioritizes the allocation of about VND36 trillion from the State budget to implement the Government's Resolution to directly support six groups that have been deeply affected in terms of reduced income, underemployment, difficulties, minimum living standards; as well as additional support for a number of target groups enjoying preferential and social protection policies during the pandemic. In addition, the budget must proactively allocate resources to strengthen national reserves (mainly food), support people in areas affected by natural disasters. Besides, it is required that insurance enterprises ensure the rights of those affected by the disease.

The estimated state budget revenue this year can reduce about VND140-150 trillion, the spending effort can be very positive, not to mention ensuring development investment spending and increase social security spending.

Mr. Vo Thanh Hung, Director of the State Budget Department, Ministry of Finance, said that the Ministry of Finance will continue to consistently implement solutions to cover revenue sources; reviewing revenues to enhance anti-loss revenue; payment, inspection and collection of tax debts; combating smuggling and trade fraud. These solutions will also ensure revenue according to estimates.

Comprehensive support package

When mentioning the impact of the Covid-19 pandemic, it is certain that the greatest losses willbe in production and business activities. This is the main area to ensure the budget revenue, so the Ministry of Finance proposed the Government to allow the extension, exemption, reduction of taxes, fees, charges, land rent with a total of about VND220 trillion to support businesses and people. The Ministry has submitted to the Government for promulgation Decree No. 41/2020 / ND-CP on extending the payment of taxes and land rents to people affected by Covid-19, implemented from the beginning of April 2020. Accordingly, extending the time limit for tax payment of five months for Value Added Tax and Corporate Income Tax of enterprises; Value Added Tax and personal income tax of business households and land rent of businesses, organizations and individuals. With this policy, about 98%, or about 740,000 businesses, are operating and most of the individual business households that stop doing business are eligible for tax and land rent extension with a total of about VND180 trillion.After the Decree was issued, the tax authorities created procedural conditions for subjects applying for extension with a simplified procedure. To date, more than 14,500 applications have been submitted for renewal.

In addition to the aforementioned support package, the Ministry of Finance is submitting to the Government a series of measures such as raising the family allowances when calculating Personal Income Tax; reducing corporate income tax for small and medium enterprises to 15-17%; amending the preferential import and export tariff; revising support for import-export enterprises.

In order to support and reduce difficulties for enterprises and strictly comply with the provisions of law on charges and fees, the Ministry of Finance has proactively and presided over and coordinated with ministries and ministerial-level agencies to review and promulgate according to its competence (or to submit to the Government) to promulgate documents on exemption and reduction of fees and charges, such as exempting license fees for some subjects,reducing many fees and charges with high reduction, such as 70% reduction of fee for enterprise registration; 67% reduction of business information publication fee; 50% reduction of fees for evaluation and re-issuance of postal operation licenses; 50-70% reduction of fees for evaluation and amendments to and additions to postal operation licenses.

The Ministry of Finance has also developed many Circulars stipulating exemption and reduction of fees and charges, such as 20% reduction of appraisal fees for granting licenses to exploit and use water resources and 30% reduction of fees for exploiting meteorological data; reduction of 50% of fees for granting operation license of credit institutions; 50% reduction of fees for evaluation of construction investment projects; 50% discount on security transaction registration fee; fee for registration of written notices on disposal of security assets; reduction of 50% of the fee level 20, fee in securities field; 50% reduction of fee for evaluation of granting business licenses for international and domestic travel service business; 30% reduction of fee for appraising business conditions in labor safety technical inspection activities. According to the preliminary assessment, the implementation of these solutions will reduce the budget revenue by about VND40,000 billion.

According to Mr. Pham Dinh Thi Director of the Tax Policy Department, Ministry of Finance, the above solutions will contribute to reducing costs for businesses. Although in the short term, it is possible to reduce the budget revenue, in the long term; favorable business enterprises will create many sources of tax revenue and create many jobs. This is the foundation for the economy to develop sustainably again after the difficulties brought by the Covid-19 pandemic.