Implement fiscal policies to support economic recovery and development

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Fiscal policies have actively supported enterprises. Photo: H.Anh

The solutions related to revenue policies have contributed to supporting and removing difficulties for people and businesses.

Perfecting the Resource Mobilization Project

After Resolution 43/2022/QH15 on fiscal and monetary policies to support the Socio-economic Recovery and Development Program was issued, the Ministry of Finance submitted competent agencies to issue policies on tax exemption, reduction and extension of payment deadlines, and credit policies through the Bank for Social Policies, ensuring resources to implement the program.

Accordingly, the Ministry of Finance has submitted to the Government and Prime Minister to issue Decision 448/QD-TTg dated April 12, 2022 approving the 3-year public debt management program for 2022-2024 and the public debt repayment plan in 2022.

The public debt repayment and borrowing plan in 2022 aims to mobilize loans to meet the State budget balance, including resources to implement fiscal policies to support the program with appropriate costs and risks by diversification of capital sources and internal and external borrowing methods.

The plan shows that the Government needs to mobilize additional resources to have resources to implement the fiscal and monetary policies approved by the National Assembly.

According to the plan, the Government’s loan plan is up to VND673,546 billion, including loans for central budget balance of VND646,849 billion to offset the State budget deficit and borrow to repay principal, ODA loans, preferential loans from foreign donors for on-lending worth about VND26,697 billion.

The Ministry has reported to the Government to submit to the National Assembly Standing Committee on the plan on using additional revenue and the central budget saving in 2021, in which, VND2.2 trillion will be added for investment expenditures under the Socio-Economic Development and Recovery Program, and VND6.6 trillion to support for employees according to Resolution 43/2022/QH15.

The plan will be finalized by the Ministry after the National Assembly Standing Committee gives the comments.

In June 2022, the Ministry of Finance will report to the competent authorities on the project on mobilizing resources for the socio-economic recovery and development program. Currently, the Ministry has gathered feedback from ministries and government agencies on the program. The ministry is assigned to report to the Prime Minister on the mobilization of loans of the Japanese Government and to borrow canceled IDA loans in 2022 by the World Bank.

Effective implementation

The Ministry of Finance has also submitted to the Government and the Prime Minister for promulgation Decree of 15/2022/ND-CP; Decree 32/2022/ND-CP, Decree 34/2022/ND-CP, Decree 148/2021/ND-CP on tax exemption, reduction and extension of tax payment deadlines; managed and used revenue from ownership transformation of enterprises, public service delivery units to support people and businesses.

After five months of implementation, the ministry has to exempt and reduce about VND22.6 trillion of VND64 trillion when developing the Program. It has submitted to the Government and the Prime Minister for the promulgation of decrees and decisions on interest rate support for loans at the Bank for Social Policies, and credit for students. As of May 31, 2022, this bank issued government-guaranteed bonds to create loans worth VND2.7 trillion and lend with a loan balance of VND4,586 trillion.

Regarding the progress of implementing the package to support economic recovery and development worth about VND350,000 billion, Deputy Prime Minister Le Minh Khai said that a number of resources have been allocated to import vaccines and medical equipment.

After Resolution 43/2022/QH15 was issued, the Government issued Decree 15/2022/ND-CP on VAT reduction from 10% to 8%, which took effect from February 2022 and until the end of 2022. This policy has been implemented effectively.

Dr. Nguyen Minh Tan, Deputy Director of the Finance and Budget Department (National Assembly Office) focused on the solution of using additional revenue and saving budget expenditure in 2021.

Accordingly, the level of support is based on the progress of public revenues and expenditures by the end of 2021 and based on the allocation of the additional revenue and saving budget expenditure as per the provisions of Article 59 of the State Budget Law 2015.

It is necessary to have a flexible and reasonable resource mobilization mechanism to avoid waste; manage the creation of resources effectively on the basis of increasing revenue, reducing expenditure, reducing borrowing, controlling inflation; strengthen solutions to raise the State budget revenue, combat revenue loss, transfer pricing, and tax evasion, especially in real estate and business on digital platforms, ensuring more sustainable state budget revenue; strictly control revenue sources; and take advantage of the available space to increase the State budget revenue on the basis of restructuring the revenue.