At the National Assembly's group discussion session on the afternoon of July 22, Minister of Finance Ho Duc Phoc shared some information about the socio-economic situation and state budget (NSNN) in 2021.

Concentrating resources to support localities in fighting the pandemic

Minister Ho Duc Phoc said that in 2021, the pandemic has had a profound impact on all aspects of the socio-economic situation. In the first 6 months of the year, the economy grew by 5.64%, but mainly from January to April. Although the state budget revenue for the first 6 months still reached 58% of the estimate, since May, the budget revenue has decreased by 32 trillion VND, in June it decreased by 40 trillion VND and in July it is expected to decrease by 70-80 trillion VND. Due to the impact of the epidemic, the restaurant, hotel, aviation, transportation service industries... have almost stagnated. Many small and medium-sized enterprises have almost no jobs, high tax debts, and very difficult capital sources. Recently, many black credit cases have been handled by the police, including many cases of usury lending to small and medium-sized enterprises to roll over debts.

In such a difficult economic situation, the Government has continued to implement the tax deferral policy until December 31, 2021. At the same time, it has focused resources on purchasing vaccines with a quantity of 61 million doses in the first phase, out of a total plan of 150 million doses with a total cost of about 25.2 trillion VND. In addition to the important role of state budget resources, the Government has established the Covid-19 Vaccine Fund to mobilize the community's support in preventing the pandemic and has so far received more than 8.2 trillion VND.

Determining that the situation from now until the end of the year will be difficult, the Ministry of Finance is currently closely monitoring the budget revenue situation on a daily basis to manage expenditures. The Ministry has also worked with the Ministry of Labor, War Invalids and Social Affairs to advise the Government to issue a support package of VND 26,000 billion (Resolution 68), at the same time reducing 30 types of fees, supporting provinces, and providing funding for ministries and branches to fight the epidemic. Affirming that these are great efforts of the Government in fighting the epidemic, the Minister stated that the Government is determined to concentrate resources to support localities, together with ministries and branches to create the best foundation for localities to prevent and control the epidemic.

Perfecting institutions to promote economic development

In addition to epidemic prevention and socio-economic development, another issue emphasized by Minister Ho Duc Phoc is the work of perfecting institutions, to remove difficulties and obstacles, prevent waste and loss, and create breakthroughs to promote economic development. In the past 6 months, the Ministry of Finance has consulted the Government on 20 Decrees, of which the Government has signed and issued 16 Decrees. In addition, 4 more Decrees have been submitted and 2 Decrees are being drafted.

Some of the Decrees issued are Decree 52/2021/ND-CP stipulating the extension of the deadline for payment of value added tax, corporate income tax, personal income tax and land rent in 2021; Decree 44/2021/ND-CP guiding the implementation of deductible expenses when determining taxable income for corporate income tax on support and sponsorship expenses of enterprises and organizations for Covid-19 prevention and control activities; Decree 67/2021/ND-CP amends and supplements a number of articles of Decree 167/2017/ND-CP dated December 31, 2017 of the Government regulating the rearrangement and handling of public assets; Decree 60/2021/ND-CP regulating the financial autonomy mechanism of public service units...

In particular, Decree 60 overcomes many limitations of Decree 16 on public service units. Accordingly, it classifies units according to the level of autonomy, clearly stipulates autonomy in basic construction investment, guides units to implement joint ventures and associations... to remove bottlenecks for development units. In Decree 67, which decentralizes management to local authorities and ministries, the Ministry of Finance only has opinions on assets worth over VND500 billion...

"Only when legal bottlenecks are actively resolved and institutions are perfected can we talk about promoting administrative reform. Otherwise, no one dares to do it because of many conflicts and obstacles," Minister Ho Duc Phoc emphasized and gave examples of overlaps and conflicts between current regulations such as the Land Law, Investment Law, etc.

Not only in the laws, many major problems currently exist in Decrees and Circulars. Recently, the Ministry of Finance has proposed that the Government assign the Ministry of Natural Resources and Environment to amend Decree 44 guiding the method of determining land prices. According to Circular 36 guiding the Decree, there are up to 5 methods for determining land prices and all 5 of these methods are inconsistent, unclear, in other words, inaccurate. Because with the same method of calculating prices, each person can calculate a different price, which has led to many violations and losses related to land. Although the Land Law is expected to be amended in 2023, the provisions under the law can be amended immediately, in which determining land prices is a very urgent issue, said Minister Ho Duc Phoc.

Budget deficit in 2019 reduced to 2.67% of GDP

Previously, at the National Assembly meeting on the morning of July 22, Minister of Finance Ho Duc Phoc, authorized by the Prime Minister, presented a proposal to the National Assembly to approve the 2019 state budget settlement.

According to the proposal, the 2019 state budget revenue settlement was VND 1,553,611.589 billion, an increase of 10.1% (VND 142,311.589 billion) compared to the estimate, mainly due to increased revenue from housing, land, other budget revenues, import-export taxes and crude oil revenues; the central budget (NSTW) increased (including aid) by VND 33,450.42 billion, the local budget (NSDP) increased by VND 108,861.169 billion.

The finalized state budget expenditure was VND 1,526,892.949 billion, equal to 93.5% (a decrease of VND 106,407.051 billion) compared to the estimate. The main reason was that some expenditure items were implemented slowly, so the estimate was canceled or transferred to the next year for further expenditure according to the provisions of the State Budget Law.

Divided by sector, development investment expenditure was VND 420,779.784 billion, equal to 98% (a decrease of VND 8,520.216 billion) compared to the estimate. Regular expenditure was VND 995,647.182 billion, reaching 95.5%, a decrease of VND 47,168.818 billion compared to the estimate. The regular expenditure estimate was 63.85% of the state budget expenditure estimate, in accordance with the orientation of Resolution No. 25/2016/QH14 of the National Assembly and Resolution No. 07-NQ/TW of the Politburo.

With such revenue and expenditure results, the final settlement of the 2019 State budget deficit is VND 161,490.73 billion, equal to 2.67% of the implemented GDP, down VND 60,509.27 billion (1% of GDP) compared to the estimate.

According to the Ministry of Finance's Electronic Information Portal