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Ministry studies tax and fee reduction and exemption package

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Production at Fuhong Precision Component in Đình Trám Industrial Zone, Bắc Giang Province. A 30 per cent reduction in corporate income tax is being considered to support COVID-hit enterprises. — VNA/ Photo Danh Lam

 HÀ NỘI — The Ministry of Finance is studying a tax and fee reduction and exemption package estimated to be worth around VNĐ20 trillion (US$897 million) to support citizens and enterprises affected by the COVID-19 pandemic.

Nguyễn Quốc Hưng, director of the ministry’s Tax Policy Division, said that the proposals about tax and fee reductions and exemptions would be raised in a draft about budget collection solutions.

The procedure for the draft compilation would be shortened and proposed to the National Assembly’s Standing Committee soon to provide timely support to virus-hit citizens and businesses.

The pandemic had badly affected lives of citizens and production and business of enterprises, especially those of small and medium sizes and household businesses, as well as a number of sectors, including tourism, transportation, accommodation and catering services, Hưng said.

“It is necessary to raise timely support for citizens and enterprises to help them overcome the impact of the COVID-19 pandemic,” he stressed.

Under the draft, four proposals about tax and fee reduction and exemption were raised.

Notably, the ministry proposed a 30 per cent reduction in the corporate income tax which enterprises must pay in 2021.

A 50 per cent reduction in tax which household businesses and individuals operating in all sectors must pay in the third and the fourth quarter of 2021 was proposed, together with a 30 per cent reduction in the value added tax for several sector.

The ministry also proposed exemption of the fee for late payments arising in 2020 and 2021 for enterprises and organisations which incurred losses for the three consecutive years of 2018, 2019 and 2020.

The Government asked the Ministry of Finance to complete the draft and propose it to the Prime Minister before August 10.

Hưng said that the reductions and exemptions were estimated to cause a drop of about VNĐ20 trillion in budget revenue.

The ministry was also studying proposals to reduce land use fees in 2021, he said.

It has been estimated that the Government support in tax and fee reductions and exemptions will total VNĐ138 trillion this year, of which support worth VNĐ118 trillion has already been issued.

The tax and fee reductions and exemptions totalled VNĐ129 trillion last year. —

Source: https://vietnamnews.vn/economy/1003114/ministry-studies-tax-and-fee-reduction-and-exemption-package.html

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GDP to reach 3.5-4 per cent this year

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Việt Nam’s exports this year would increase by 10 per cent which is quite impressive in the current world context. — Photo vietnamplus.vn

HÀ NỘI — The country’s GDP this year is expected to reach 3.5-4 per cent if the COVID-19 pandemic is controlled in September and a ‘new normal’ achieved from the fourth quarter, said Minister of Planning and Investment Nguyễn Chí Dũng.

Việt Nam’s exports this year would increase by 10 per cent while State budget revenue will exceed the estimate. The growth will be low but quite impressive in the current global context.

“This forecast is lower than the set target of 6.5 per cent this year, but achieving this level needs a huge effort, requiring more drastic actions of both the political system and localities,” Dũng said.

If GDP reaches the level, this will be the second year that Việt Nam’s GDP has not completed its growth plan. In 2020, GDP grew by 2.92 per cent due to the impact of the COVID-19 pandemic. This would affect the implementation of the overall goal of the five-year plan in the 2021-25 period.

He said that social distancing has seriously affected production, business, labour and employment. Meanwhile, the country has spent large resources on the fight against the pandemic, affecting State budget revenue and expenditure. The pandemic also affects the establishment of businesses and attracting FDI.

In particular, domestic consumption of agricultural products faces difficulties due to low purchasing power. The increasing input prices have affected the psychology of production expansion and re-herding. In addition, the price of animal feed continued to increase due to the difficulty of importing raw materials and high transportation costs, which greatly affected livestock development.

The minister said localities need to take advantage of the recovery momentum of major economies that have a great influence on Việt Nam’s economy. The country should rapidly restructure the economy and add elements of innovation and promote the values ​​of Vietnamese culture and people.

He asked localities to give priority to preventing the pandemic so as it doesn’t re-emerge, leading to social distancing, disrupting production and supply chains. In addition, they should have regular dialogues with businesses to create a favourable investment environment while closely following new trends to build socio-economic development plans, including public investment.

He added that during the current difficult time, the local authorities’ attitude to businesses is even more important than the above support.

The localities were also asked to ensure social security and support for affected people as well as actively develop local economic recovery plans, take advantage of the world’s new opportunities to achieve growth targets, and contribute to the overall growth of the country.

“Researching and proposing solutions to build an economic recovery programme after COVID-19 is important and urgent. The solutions should be implemented immediately after the pandemic is under control, focusing on recovering key sectors and areas,” he added.

Accordingly, the Ministry of Planning and Investment will submit to the Government an economic recovery project in October. It is expected that the next two years would be the economic recovery time of the whole country.

“The world changes very quickly. If we don’t build an economy that is autonomous and adaptive, we will be unexpectedly passive. For example, the pandemic could last for a long time, not to mention natural disasters. Currently, the ministry is developing a project to build an autonomous economy.”

Many international experts said that the economy has many optimistic signals to be able to return to a good growth trajectory if the pandemic is controlled. The Government has been on the right track in defining and implementing a vaccine strategy and key economic policies.

Tim Leelahaphan, an economist in charge of Việt Nam and Thailand at Standard Chartered Bank, said that Việt Nam is on the way to its goal of becoming a regional supply chain centre, a modern industry and a future high-income country. Việt Nam has also benefited from the recent supply chain shift. However, it should be noted that the ability to control COVID-19 would play an important role in Việt Nam’s economic prospects in the short term.

Economists also said that the driving force of economic growth depends heavily on the implementation speed of support solutions for people and businesses; expanding commercial activities, taking advantage of opportunities from free trade agreements (FTAs), digital transformation, and accelerating disbursement of public investment capital. This is the short-term and long-term driving force for Việt Nam’s economic growth and also the measures that Việt Nam has taken since the outbreak of COVID-19 in early 2020.

Economist Võ Trí Thành said the Government’s solutions to continue implementing security and business support packages are timely. However, the important issue is the implementation speed of support policies, with more accessible criteria to maximise support for businesses, ready to prepare for the post-COVID-19 period. —

Source: https://vietnamnews.vn/economy/1032214/gdp-to-reach-35-4-per-cent-this-year.html

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Vietnamese man’s billion-dollar game conquers int’l market

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Nguyen Thanh Trung, founder and CEO of Sky Mavis, an Ethereum-based project, started his business from the world market first with only 5 percent of the gamers being Vietnamese.

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Vietnamese man’s billion-dollar game conquers int’l market

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Episode 13 of talk show “Nguy Co”.

Source: https://e.vnexpress.net/news/business/vietnamese-man-s-billion-dollar-game-conquers-int-l-market-4357279.html

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Vietnam’s economy will recover after lockdown is lifted: WB economist

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Vietnam’s economy will recover on the back of solid growth achieved in the first half of 2021 after the lockdown is lifted, Dorsati Madani, Senior Economist at the World Bank (WB) Vietnam, has said.

Vietnam’s economy will recover after lockdown is lifted: WB economist hinh anh 1

Vietnam’s economy is expected to recover after the lockdown is lifted. 

The economy is likely to bounce back strongly from the end of the third quarter, similar to how it has recovered after the lockdown was eased in April last year.

She said though Vietnam is facing multiple economic risks due to impacts of the COVID-19 pandemic, its economy has proven to be resilient and dynamic. The country was among a few nations sustaining positive economic growth last year.

The economist also expressed her hope that the Vietnamese economy can rebound in the future as a result of the recovery of its major markets, such as the US, China, and the EU.

Last month, the WB forecast Vietnam’s GDP to expand by about 4.8 percent in 2021, two percentage points lower than its projection last December.

“Whether Vietnam’s economy will rebound in the second half of 2021 will depend on the control of the current COVID-19 outbreak, the effective vaccine rollout, and the efficiency of the fiscal measures to support affected business and households, and to stimulate the recovery,” said Rahul Kitchlu, WB Acting Country Director for Vietnam.

“While downside risks have heightened, economic fundamentals remain solid in Vietnam, and the economy could converge toward the pre-pandemic GDP growth rate of 6.5 to 7 percent from 2022 onward.”

The WB is waiting for figures to be released by the General Statistics Office (GSO) by the end of this month and the Vietnamese government’s decision on reopening the economy to revise its GDP prediction./.

Source: VNA

Source: https://vietnamnet.vn/en/business/vietnam-s-economy-will-recover-after-lockdown-is-lifted-wb-economist-775198.html

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