Budget deficit will continue to fall in 2019

	Minister Dinh Tien Dung: will conduct key inspection and risk management for handling violation
	Finalization of budget 2016: The budget deficit is equal to 4.95% of GDP estimation
	The State budget deficit in 2018 at 3.7% of GDP

Minister Dinh Tien Dung.

Public debt was 61.4%

According to the report from the Government, state budget revenue in 2018 exceeded 3% of the estimate; revenue structure is more stable; revenue from imports and exports from crude oil decreased; domestic revenue increased, accounting for nearly 82% of total state budget revenue. The inspection, examination, anti-loss of revenue, anti-tax debts and anti-transfer pricing were focused. State budget expenditure was strictly controlled, more economical and efficient. The proportion of development expenditures was 26.8%, higher than the previous period (23.6%) and the 2016-2020 plan (25-26%). Although the fund for annual salary increase of 7% was ensured but the proportion of recurrent expenditures still fell to 63.3%, lower than the beginning of the term (67.7% in 2015) and the 2016-2020 plan (below 64%). The state budget deficit was estimated at 3.67% of GDP, lower than the set target of 3.7%, it is expected to reach 3.4% by 2020 (the target is less than 4%). Public debt was about 61.4% of GDP, down sharply compared to 63.7% in 2016.

On behalf of the Government to report to the National Assembly, Mr. Dung said that responding to the complicated performance of natural disasters, storms and floods, in the past nine months, the Government has actively used VND 56 trillion from the Central budget reserve to overcome natural calamities, epidemics and landslides, ensuring the safety of dyke works, reservoirs and some important tasks on national defense and security.

In the remaining months of the year, the Government will continue to direct units to strive to achieve and exceed the reported levels, focusing on the management of revenue collection and combating against revenue losses, transfer pricing, recovering outstanding debts and controlling expenditures strictly and economically, and speeding up the disbursement of capital construction investment. For localities striving to raise revenues and minimize revenue losses, if the localities predict revenue losses, they have to actively reduce spending tasks and concurrently mobilize the local resources.

According to Mr. Dung, for 2019, the Government submits to the National Assembly the estimates as follows: the state budget revenue shall be VND 1,411.3 trillion. The mobilization rate into the state budget is about 23% of GDP, of which from taxes and fees is 20%. Domestic revenue shall be VND 1,173.5 trillion; the proportion of domestic revenue accounts for 83.2% of total state revenue. Revenue from crude oil shall be VND 44.6 trillion, equal to 3.2% of total state budget revenue, gradually decreasing year by year. The revenue from import and export balance shall be VND 189.2 trillion, equivalent to 13.4% of the total revenue, of which the revenue from imports and exports is estimated at VND 375 trillion and expenditure for VAT refund is estimated at VND 111.3 trillion. Revenue from aids shall be VND 4 trillion.

State budget expenditure for 2019 is estimated at VND 1.633 trillion, which is expected to be allocated as follows: Expenditure for development investment is VND 424.3 trillion, higher than the 2018 estimate in both proportion and specific value; Recurrent expenditure is VND 1,042.8 trillion, equal to 63.8% of total state budget expenditure, lower than the 2018 estimate. One important point is that the 2019 budget is estimated to be used for revising up the basic salary.

Salary increase of 7% is positive

Verifying the report of the Government, National Assembly's Finance - Budget Committee Nguyen Duc Hai said that in order to implement Resolution 18-NQ / TW of the Central Plenum 6, the Government has developed a recurrent expenditure estimate for 2019, including the fund for staff streamlining and allocation of the autonomy mechanism towards cutting expenditures for salaries and for operations of public non-business units according to the roadmap.

Regarding the salary reform (rising by 7% from July 1st, 2019), Hai said that the wage reform is implemented in accordance with the roadmap decided by the National Assembly in the five –year financial plan 2016-2020, for the purpose of contributing to improving the income of cadres and civil servants. On the other hand, the salary reform in 2019 that shall be carried out together with staff streamlining under Resolution 18-NQ / TW is appropriate. Thus, most of the members of the Finance - Budget Committee agree with the Government’s plan.

Regarding the budget deficit and public debt, Mr. Hai noted that the Government expects that the state budget deficit in 2019 shall be about 3.6% of GDP, down 0.1% of GDP compared to 2018.

"In the context that the ability to increase state budget revenues is difficult, while the demand for investment is great, many spending tasks need to be ensured such as expenditures for wages and for social security policies, the deficit remaining lower than 2017 is positive,"- said Hai.

Regarding public debt, the representative of the investigating body found that the ratio of public debt / GDP tended to decrease in recent years, but the government debt and foreign debt of the country tended to increase, especially the foreign debts have reached the allowable ceiling rate (50% of GDP). Specifically, public debt in 2017 was 62.6% of GDP, in 2018 was 61.4% of GDP, by 2019, it is expected to only be 61.3% of GDP. Meanwhile, government debt in 2017 was 51.8% of GDP, in 2018 was 52.1% of GDP and by 2019, it is expected to be 52.2% of GDP. The foreign debt in 2017 was 45.2% of GDP, in 2018 was equal to 49.7% of GDP, and by 2019 is expected to equal 49.9% of GDP.

The budget deficit in the 7 months of 2016 is 78.5 trillion vnd VCN- According to statistics of the Ministry of Finance, the total revenue for July is 102 trillion ...

"Although these indicators remain within the allowable limits, there are still potential risks, thus, the Government needs to seriously implement and introduce measures to ensure national financial security," said Hai.