Despite many difficulties, state budget management still achieves many positive results

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Minister of Finance Ho Duc Phoc, authorized by the Prime Minister, presents the report. Photo: Quochoi. vn

State spending in 2024 estimated to rise by about 1.2% from 2023

At the 6th Session of the National Assembly XV, on the afternoon of October 23, authorized by the Prime Minister, Minister of Finance Ho Duc Phoc presented a report on the implementation of the State budget in 2023, estimates State budget, central budget allocation plan for 2024, and State budget-finance plan from 2024-2026.

According to the report, State revenue in the first nine months of 2023 reached 75.5% of the estimate. To respond to slow world economic growth and many difficulties in the domestic economy, the Government and the National Assembly have offered many policies on exemption, reduction, payment deadline extension of taxes, fees, and land rent. The revenue contributed to the State budget reached about 15.7% of GDP.

Minister Ho Duc Phoc said that if including the reduced amount of VND75 trillion due to the implementation of preferential policies, tax exemptions, and reductions, the whole year's state revenue rose by about 4.6% compared to the estimate. This is a very positive rate.

Regarding state budget spending in 2023, the country spent 59.7% of the estimate in 9 months. Regarding the state budget balance in 2023, the budget deficit is estimated to be about 4% of GDP. By the end of 2023, the targets of public debt, Government debt, national foreign debt, and direct debt repayment obligations of the Government will be within the scope allowed by the National Assembly.

Regarding the state budget estimate and central budget allocation plan for 2024, Minister of Finance Ho Duc Phoc stated that the revenue estimate for 2024 will increase by about 5% from 2023, and the mobilization rate into the state budget will reach 15.3% of GDP.

Regarding budget deficit, closely following the target of the 5-year plan according to the Resolution of the National Assembly, the estimated deficit in 2024 is about 3.6% of GDP. By the end of 2024, the targets of public debt, Government debt, national foreign debt, and direct debt repayment obligations of the Government are within the scope described by the National Assembly.

The Minister of Finance also reported to the National Assembly on the financial capacity to implement wage reform according to Resolution 27-NQ/TW from July 1, 2024.

Regarding budget spending, the Government proposes principles for budget spending estimation in 2024 on the principle of ensuring the spending for development investment is greater than the spending for tasks in the medium-term public investment plan according to the Law Public investment and other development investment spending tasks according to the State Budget Law.

The session. Photo: Quochoi.vn

The head of the finance sector also said that the Government has arranged full and on-time interest payments, reserve expenditures, and national reserves at a reasonable level to ensure timely handling of urgent tasks; arranged resources to implement salary reform according to the Central conclusion; arrange resources to revise up pensions, social insurance benefits, and monthly benefits for subjects covered by the state budget; increase preferential regimes for people with meritorious services and implement a number of social welfare regimes to ensure partial compensation for price fluctuations; implementing national target programs, political tasks, national defense, security, and socio-economic development.

According to the Minister of Finance, such the above state budget revenue and deficit levels, the estimated spending in 2024 will increase by about 1.2% compared to 2023.

There are still many potential risks when domestic revenue decreases

Reporting on the three-year State budget and financial Plan for 2024-2026, the Minister of Finance stated that the plan is built with the expectation that the socio-economic situation will improve, inflation will be controlled and major balances will be ensured.

State budget revenue is estimated at a positive level, consistent with economic growth forecasts, which prioritize to investment spending, save regular expenditure, and ensure payments for loan interest, aids, and national reserves.

According to the Minister, at this session, the Government also submitted to the National Assembly to consider and decide on the contents, specific data, and proposals stated in the report, including some contents such as: continuing to implement green on gasoline, oil, and lubricants; and continue to reduce VAT rate by 2%; and decide on some reported contents including: increasing the capital allocation to the local budget in 2024; dealing with expenditures to balance local budgets; shifting the revenue from salary reform in the previous year to the spending estimates in 2024 to implement the base salary of VND1.8 million per month…

Presenting the verification report, the Chairman of the National Assembly's Finance and Budget Committee Le Quang Manh stated clearly that although our economy has faced many difficulties and challenges, with the efforts and determination of the Government, the management of the state budget has achieved many positive results.

However, he also noted some issues. The state revenue achieves the estimate, but in fact there are still many potential risks when domestic revenue decreases. State budget revenue is heavily influenced by policies on reducing and exempting taxes and fees.

The Finance and Budget Committee also believes that the central role of the central budget is affected. Local budget revenues are uneven among localities. Many localities do not meet their estimates.

Regarding spending, the Finance and Budget Committee said that the disbursement progress of development investment in the first eight months of the year has had positive improvements year-on-year but still does not meet the requirements. We need to have specific and drastic solutions, attached to the responsibilities of the head.

Regarding the national target program, according to the Finance and Budget Committee, capital disbursement in many localities is still slow, requiring a comprehensive solution to speed up the disbursement.

Regarding the state budget estimate for 2024, the Finance and Budget Committee believes that the revenue estimate plan in 2024 is 5% higher than the estimate in 2023 is quite positive. However, state budget revenue still contains risky and unsustainable elements when land revenue sees a high increase.

Regarding expenditure estimates, the Finance and Budget Committee noted that it is necessary to make an overall assessment of the implementation of the salary reform policy, balance resources for 2024-2026, and forecast spending until 2030 to ensure feasibility and long-term; develop synchronous solutions to increase sustainable budget revenue and activeness in budget allocation. It is recommended to have flexible fiscal and monetary policies, and policies to supplement revenues the next period.