Minister Ho Duc Phoc

Fiscal policy for the sake of citizens

At the MoF's preliminary conference on work review of the first six months of 2023, Minister Ho Duc Phoc reiterated the Prime Minister's remarks at the conference on work review at the end of 2022.

At that time, the Prime Minister had claimed that there would be many difficulties and challenges in 2023, so the Financial sector must be more determined and creative to meet the set financial and State budget goals.

According to the Minister, the sluggish economy has had a direct impact on budget revenue in the first months of 2023. In that context, the Financial sector has made great efforts in managing fiscal policy, ensuring that revenue sources meet expenditure tasks.

Simultaneously, the Financial sector has implemented numerous fiscal policies for the citizens’ sake. The policy packages on the exemption, reduction, and extension of taxes, fees, charges, and land rents that have been issued in 2023 are worth an aggerate of about 200 trillion VND. In particular, 79 trillion VND is spent on exemption and reduction and 121 trillion VND is allocated to extension.

According to the Financial sector's head, this is a significant effort by the MoF in the context of difficulties; it is still necessary to maintain the state budget revenue and expenditure balance, and simultaneously create conditions for businesses to develop.

"The Financial sector has made significant attempts to manage in the context of economic slowdown and decreased budget revenue compared to the same period in 2022. The budget revenue still reached 54 % of this year’s target, ensuring the progress of budget revenue in comparison to the estimate. This is also a factor to take into account in the development of the 2024 budget”, said the Minister of Finance.

In the last 6 months of the year, Minister Ho Duc Phoc demonstrated that the MoF will continue to implement fiscal policy solutions, combined with monetary policy and other macro policies to support the economy, ease difficulties for businesses and individuals; contribute to controlling inflation, maintaining macroeconomic stability, ensuring large balances of the economy; strive to complete and exceed the set economic growth target in 2023.

Concerning the management of tax collection, according to the Minister, the Tax sector keeps concentrating on strengthening discipline and implementing value-added tax refunds (VAT) under the law. The Financial sector has introduced a variety of solutions in tax collection management over the years, promoting the use of information technology and artificial intelligence to publicly and transparently implement in revenue management. On this occasion, the Financial Sector’s Head has requested that local leaders closely manage budget revenues, particularly VAT refund management.

In addition to policies to support individuals and businesses, the Financial sector has strictly and effectively managed public debt. Vietnam's public debt to gross domestic product (GDP) ratio has been in a downward trend in recent years, falling from 44% of GDP in 2021 to about 38% of GDP in 2022. This is a bright spot in the administration of the Government and the MoF.

Along with that, the stock market and insurance remain important capital channels for the economy.

Unblocking the disbursement bottleneck, promoting growth, and generating revenue for the State budget

The Finance Minister also stated that from now until the end of the year, it is essential to accelerate the disbursement of public investment capital, support individuals and businesses, and unblock the economy's "bottlenecks" to promote growth in line with the set goals.

In terms of solutions from now until the end of the year, the Financial sector's head agreed with eight solutions proposed by the MoF. However, the Minister emphasized five key solutions, proposing that the entire Financial sector be determined to achieve the set goals.

Accordingly, the Minister emphasized that the whole Financial sector remains focused on the development of financial law policies; implementation of fiscal policy solutions, combined with monetary policy and other macro policies to support the economy and remove difficulties for businesses and people.

Regarding performance of financial - State budget tasks, the entire sector drastically performs the tasks of revenue and expenditure of the State budget and strictly controls deficit based on the National Assembly's budget. Moreover, the sector strives to meet and exceed the National Assembly's estimated budget, compensating for revenue losses caused by the implementation of support policies.

Simultaneously, the entire sector strengthens its management of State budget revenue and fights against State budget revenue loss. Furthermore, it is crucial to manage State budget expenditure strictly, economically, and effectively, according to estimates, and focus on speeding up the disbursement of public investment plans, especially foreign loans, and capital from national target programs.

The Minister also suggested that financial discipline and discipline in the field of public finance be improved; that inspection, examination, supervision of the publicity, and transparency of State budget and asset usage be strengthened; and that inspection against smuggling, trade frauds, and counterfeiting be promoted.

It is claimed that the situation from now until the end of the year remains challenging. Nevertheless, the Financial sector’s head affirmed that the entire sector will continue to make efforts to fulfill the assigned tasks by 2023./.