Budget revenue in 2022 estimated to increase by 3.4% compared to 2021

The state budget estimate in 2022 is built on the basis of expected economic growth of 6-6.5%

Estimated domestic revenue is VND1,176.7 trillion

According to the Ministry of Finance, the recovery process and the world economic growth rate in 2022 are forecast to be lower than in 2021, in which emerging and developing countries have a higher growth rate depending on the rate of immunization and safe adaptation to Covid-19 applied.

In addition, the possibility of gradually tightening fiscal and monetary policies of some major economies among to control inflation and financial safety, climate change, extreme weather and other diseases are also risks that affect the global economic recovery.

In the country, the experience, capacity and ability to tackle the pandemic continued to be improved, but the resilience and resources of the State, businesses and people decreased.

The goals of economic growth and social stability depend greatly on the completion of vaccine coverage and control of the pandemic to reopen the economy, promote socio-economic development and recovery.

Based on the forecast of the world and domestic economic situation and socio-economic development requirements and tasks, the state budget target in 2022 is determined as: mobilizing, allocating and effectively using the State’s resources to prevent, combat and control the Covid-19 pandemic, make good use of opportunities to promote socio-economic recovery and development; continue to maintain macroeconomic stability, control inflation, ensure social security; continue to restructure the state budget, manage public debt, ensure the leading role of the central budget, promote the initiative of ministries, sectors and localities; promote administrative reform and modernization associated with reorganization of the apparatus, streamlining staff, renovating the public non-business sector, tightening financial and budgetary discipline, and thoroughly saving state budget expenditure.

On the basis of assessing the ability to perform socio-economic tasks in 2021, the state budget estimate in 2022 is built on the basis of expected economic growth of 6-6.5% compared to 2021, the average growth rate of the consumer price index (CPI) is about 4%; crude oil price at $60/barrel; export turnover growth is about 5.2%.

Regarding budget revenue, the estimated total state budget balancing revenue in 2022 is VND1,411,7 trillion, an increase of about 3.4% compared to the estimated implementation in 2021. The rate of mobilization into the state budget is about 15.1% of GDP, in which revenue from taxes and fees is about 12.7% of GDP.

Specifically, the estimated domestic revenue is VND1,176.7 trillion, accounting for 83.4% of the total state budget balancing revenue, an increase of about 3.8% compared to the estimated implementation in 2021; the estimated revenue of crude oil is VND28.2 trillion, accounting for 2% of total state budget balancing revenue on the basis of domestic production of nearly 7 million tons, the estimated oil price is about $60/barrel; estimated revenue from import-export activities is VND199 trillion, accounting for 14.1% of total state budget balancing revenue; estimated grants is VND7.8 trillion.

Allocation of total development investment expenditure is larger than state budget deficit

For budget expenditure, the principles and orientations for the allocation of state budget expenditure estimates in 2022 are determined that the arrangement of total development investment expenditure is larger than the state budget deficit; pay interest in full and on time.

Arranging recurrent expenditures follows the principles, criteria and allocation quotas decided by the Standing Committee of the National Assembly, but requires that savings are associated with streamlining the apparatus, improving the autonomy of public administrative units in line with the actual situation and specificity of each field, cut down non-urgent expenditures in order to maximize resources for the prevention and control of natural disasters and the pandemic.

Along with that, prioritizing necessary tasks, spending on social security and improving the lives of beneficiaries of preferential allowances for people who are revolutionary contributors and on low pensions should be prioritized; allocate expenditures on national target programs appropriate with the ability to disburse and balance the state budget.

At the same time, arrange national reserves as prescribed to ensure timely handling of urgent tasks.

As expected, the state budget balance expenditure estimate in 2022 is VND1,784.6 trillion, an increase of 4.5% compared to the estimate in 2021. In which, it is expected to arrange state budget expenditure estimates for a number of specific key tasks as follows:

Expenditure on development investment is about VND526.1 trillion, accounting for 29.5% of total state budget expenditure, up 10.2% compared to the estimate in 2021; interest payment is about VND103.7 trillion, accounting for 5.8% of total state budget expenditure, down 5.8% compared to the estimate in 2021.

Estimated recurrent expenditure is VND1,111.19 trillion, accounting for 62.2% of the total state budget expenditure, up 5.1% compared to the estimate in 2021. In particular, focusing on arranging to increase spending on some social security policies.

For example, policy support for frontline forces fighting the Covid-19 pandemic and social security for people; poverty line adjustment; pensions for people who retired before 1995; allowance regime for people who are revolutionary contributors; other recurrent expenditure tasks to thoroughly save from the stage of estimation.

Regarding the state budget overspending, it is expected that the deficit will be VND372.9 trillion, equivalent to about 4% of GDP (equal to the estimated rate in 2021). The Government's direct debt repayment obligation is about 21-22% of total state budget revenue. By the end of 2022, public debt will be about 43-44% of GDP.