Fiscal policy - A pivotal milestone in promoting economic recovery and growth

VCN - On the occasion of welcoming the Year of the Dragon 2024, Minister of Finance Hồ Đức Phớc shared with Customs Magazine about the outstanding results of the Finance sector in 2023 as well as the major orientations of the sector for 2024.
Stable national finance will expand fiscal policy space Stable national finance will expand fiscal policy space
Fiscal policy expansion to bolster economic revival Fiscal policy expansion to bolster economic revival
Fiscal policy maintains and ensures national financial security Fiscal policy maintains and ensures national financial security
Fiscal policy - A pivotal milestone in promoting economic recovery and growth
Minister of Finance Hồ Đức Phớc

The Finance sector has successfully achieved its goals and tasks

Could you share about efforts of the Finance sector to achieve positive results in the State finance-budget work, especially the budget collection in the past difficult year?

Minister Hồ Đức Phớc:

In 2023, the world political, economic and social situation has been become complicated, significantly affecting the country’s economic recovery and growth momentum. However, the Finance sector has proactively and decisively made efforts to effectively carry out assigned tasks.

First of all, regarding the work of building and perfecting institutions, this is a task that the Ministry of Finance always attaches importance to, proactively implements, meets progress requirements, and ensures quality, thereby contributing to completing the financial legal system, helping State finance and budget management become more transparent, strict and effective. In 2023, the Ministry of Finance submitted to the Government the National Assembly for approval of the Price Law (amended) and five resolutions; submitted to the National Assembly Standing Committee for approval of two resolutions. To date, the Ministry of Finance has developed and submitted to the Government to issue 19 decrees; consider to issue 15 draft decrees; submitted to the Prime Minister to issue four decisions; consider to issue two decisions; and issued under its authority 64 circulars in the field of State finance and budget.

​Regarding state budget management, in the context that the economy still facing many difficulties after the pandemic, the business resilience stretches to their limit, the Ministry of Finance has proactively offered solutions to exempt, reduce and defer taxes, fees and charges to support businesses and help socio-economic recovery and development, and contribute to nurturing revenues. It is estimated that these solutions supported up to VND200 trillion. I think this is a particularly important mark, clearly demonstrating the positive and effective role of fiscal policy in stabilizing the macroeconomy and boosting economic recovery and growth.

In addition, the Ministry of Finance submitted to the Government and National Assembly for approval a Resolution on the application of additional corporate income tax according to global anti-base erosion model rules, which will be applied in Vietnam from 2024. This shows Vietnam's initiative in a major international playground, affirming the authority of collecting taxes on production and business activities in Vietnam's territory according to international regulations and domestic laws. Along with that, the Ministry of Finance requested the Tax and Customs authorities to strengthen revenue management through the application of information technology systems and big data systems to manage risks and prevent fraud in use of invoices, value-added tax refunds, ensuring State revenue.

By the end of December 31, 2023, budget revenue is estimated to reach VND1,752.5 trillion, exceeding the estimate by 8.1%. Notably, both the central budget and the local budget exceeded the estimates. I believed that the above result is extremely positive, an important mark in the State budget management in 2023.

Regarding state budget spending, the Ministry of Finance worked with other ministries, central and local agencies to manage the spending strictly, economically and effectively; advised the Government to direct the drastic implementation of solutions to accelerate disbursement of public investment capital and capital from National Target Programs, creating motivation to encourage economic recovery and growth. In 2023, we balanced and guaranteed resources to implement the base salary increase from July 1, 2023. This is extremely meaningful because this work was not able to implement salary reform because of the impact of the Covid -19 pandemic. This is also a key premise for us to continue implementing overall salary policy reform in 2024 according to Resolution 27-NQ/TW.

Along with that, success in controlling overspending and managing public debt is also a bright spot in fiscal policy management. The 2023 budget deficit is estimated to be below 4%, lower than the allowed rate of 4.42% by the National Assembly. Financial markets continued to be consolidated, promptly resolved difficulties and obstacles to develop more healthily, openly and transparently.

It can be affirmed that the Finance sector has successfully completed the State finance and budget goals and tasks for 2023, contributing to the country’s overall socio-economic development.

The General Department of Customs has ranked first in administrative reform for 7 consecutive years

How do you assess the management performance of Vietnam Customs in 2023?

Minister Hồ Đức Phớc:

In 2023, despite significant impacts by the increasingly complicated developments in the world situation, with the drastic direction of the Party and State leaders, Vietnam socio-economic situation saw many outstanding points. This result must mention the contribution of the Ministry of Finance, including the significant role of the General Department of Customs.

It is possible to point out some outstanding results of the Customs authority in 2023 such as: performing well its role as the standing agency of Steering Committee 389 of the Ministry of Finance, the Customs sector handled 15,993 violations of customs laws with the infringing goods amounted to VND12,476 billion, up 42.46% year-on-year, and collected VND498 billion to the State budget; prosecuted 40 cases and transferred to other agencies 186 cases; chaired and coordinated with the Police and Border Guard to seize 243 cases involving 277 drug traffickers, of which the Customs agency presided over 121 cases and seized about 2.8 tons of drugs.

In particular, international cooperation in the fight against smuggling is strongly and practically enhanced. The highlight of 2023 is the results of implementing the Mekong Dragon Campaign phase 5 co-initiated by Vietnam Customs and China Customs with the participation of 25 Customs agencies, law enforcement agencies and international organizations. As a result, 1,715 violations were seized, an increase of 111% compared to phase 4.

Last year, Vietnam Customs coordinated with the World Customs Organization (WCO) to successfully host the 2023 WCO Technology Conference and Exhibition. This is a major international event of the WCO and one of the largest international events ever for Vietnam Customs.

The General Department of Customs has performed well its role as the standing agency of the National Steering Committee on ASEAN Single Window, National Single Window and Trade Facilitation. There have been 250 administrative procedures of 13 ministries and agencies connected with the participation of 66.700 businesses. Regarding customs administrative reform and modernization, 2023 is the 7th consecutive year the General Department of Customs is ranked first in term of public administrative reform index among general departments and equivalent level of the Ministry of Finance.

Regarding state budget revenue, in 2023, the Customs sector drastically and synchronously implemented solutions to facilitate trade, improve efficiency of State and anti-revenue loss in implementing the State budget collection task in 2023. As a result, as of December 31, 2023, the Customs collected VND369,093 billion from the import and export activities, equal to 86.8% of the estimate (VND425,000 billion). However, based on the expected import-export turnover, the General Department of Customs advised the Ministry of Finance and the Government to report to the National Assembly on a downward revision to the expected State revenue in 2023 of VND 355,000 billion, equal to 83.5% of estimate. The General Department of Customs achieved this result in the context where budget collection still faces many difficulties.

It can be said that the above results are very remarkable and demonstrate the efforts of the collective of officers and civil servants of the General Department of Customs to complete the political tasks assigned by the Government and the Ministry of Finance.

Striving to develop a Digital Financial Ecosystem

It can be seen that the above achieving results had a significant contribution from the digital transformation of the Finance sector. Could you please tell us the outstanding results of the sector’s digital transformation in the past year and the directions for the coming year?

Minister Hồ Đức Phớc:

After 3 years of implementing resolutions, programs and plans of the Politburo and the Government on digital transformation, the digital transformation has created a change in thinking, awareness, and public handling methods and management, direction, and administration of most units in the Finance sector. To date, most of the direction and administration activities at the Ministry of Finance have been carried out in a digital environment. The Ministry of Finance has been gradually forming specialized database warehouses and building IT systems and applications to serve direction and administration.

In tax management, 100% of businesses, organizations, households and individuals have used electronic invoices; nearly 6.1 billion invoices were processed, of which 1.7 billion invoices had codes and more than 4.4 billion invoices had no code. At the same time, 38,500 businesses and business households have registered to use electronic invoices with codes created from cash registers with 84.2 million invoices.

Customs authority continues to effectively deploy the automated systems for customs management at ports, warehouses and yards, helping simplify customs procedures and reduce face-to-face contact between businesses and customs officials, shortening time and costs for businesses. To date, over 99% of customs procedures have been carried out electronically through the Automatic Customs Clearance Systems (VNACCS/VCIS) and satellite IT systems. In addition, the Customs coordinates with 13 ministries and agencies to carry out 250 administrative procedures on specialized management and inspection with over 6.67 million applications of more than 64,700 enterprises through the National Single Window Mechanism, etc.

In state budget management, the Ministry of Finance has successfully deployed the State Budget Data Warehouse. In the field of Treasury, the Ministry of Finance has successfully implemented the investment expenditure management and control program through the State Treasury, helping units strictly control investment expenditure. In addition, the Ministry of Finance has deployed many programs and application systems to serve internal direction and administration.

It can be seen that most fields in the Finance sector have basically made strong changes in the context of digital transformation; the work of direction and administration in the digital environment has had clear changes through each period. This results in from the drastic direction of the Politburo and the Government and the proactive change of thinking and awareness of leaders at all levels of the Finance sector. However, in addition to the above advantages, the implementation of digital transformation still faces many difficulties, especially in terms of human resources and funding.

In 2024, the Ministry of Finance sets a goal of digital transformation in three aspects: people, institutions, and technology. Decision No. 1484/QD-BTC dated July 27, 2022 of the Minister of Finance on the implementation of the Digital Transformation Plan until 2025, orientation to 2030, clearly states: "By 2030, form a rich and modern digital finance ecosystem in all fields, ensuring efficiency and information security”. Until the end of 2025, the Ministry of Finance will focus resources and strive to achieve the goal of training, coaching, and disseminating policies on digital transformation for 100% of civil servants in the Finance sector to raise their awareness and understanding of the importance of digital transformation, applying digital transformation in professional activities, especially improving management capacity based on digital data.

The Ministry of Finance will deploy information technology applications in management fields to achieve the goal of all professional activities being carried out in a digital environment. At the same time, the ministry shall connect and share data with relevant agencies and organizations; focus on deploying specialized digital platforms managed by the Ministry of Finance including: electronic taxes, electronic invoices, digital border gates, digital seaports. Thereby, striving to develop a rich and modern digital financial ecosystem in all fields.

​The goals are macroeconomic stability and inflation control

Could you tell about major goals of the finance and state budget work in 2024 and key and breakthrough solutions for the Finance sector to complete the set goals and contribute positively to the country’s development

Minister Hồ Đức Phớc:

It is forecasted that in 2024, we will implement the financial - state budget tasks in the context of the socio-economic situation with opportunities, advantages intertwined with difficulties and challenges, in which difficulties are forecast to outweigh advantages. Meanwhile, the Finance sector set arduous tasks such as: the estimated revenue is VND1.7 million billion; the estimated expenditures is VND2.1 million billion; State budget deficit is VND399.4 trillion, equivalent to about 3.6% of GDP. Thus, it is necessary to have a reasonable fiscal policy to both promote the economy and ensure macroeconomic stability, control inflation, and ensure national financial safety in 2024. Of which, macroeconomic stability and inflation control are still considered top priority goals.

In that context, the major goals of the Finance sector are to build and organize proactive, flexible fiscal policies, ensuring resources to carry out economic – social development, security, defense, social welfare, with special emphasis on resources for important infrastructure investment projects and intra-regional and inter-regional transportation projects; wage and social insurance reform policies associated with promoting organizational restructuring and streamlining. To achieve the set goals, we will drastically implement several groups of solutions:

First of all, regularly monitor and accurately forecast the world and domestic economic situation, not to be passive or shocked, focus on proactive, reasonable, flexible and effective fiscal policy management, closely coordinate fiscal policy and other economic policies to maintain macroeconomic foundations, control inflation, ensure major balances, promote sustainable growth and development of socio-economic sectors.

Second, continue to improve institutions and legal policies on state budget revenue, strengthen revenue management, strive to complete assigned revenue estimates at the highest level, and ensure resources to implement socio-economic development goals. In particular, research to improve the budget collection system in the direction of creating convenience for taxpayers, expanding the tax base, ensuring the uniformity of the law and complying with international practices; drastically implement tax management, anti-tax loss and transfer pricing, ensure tax debt collection in the digital economy and cross-border transactions.

Third, strictly manage state budget expenditures, increase spending savings, and improve the efficiency of management, allocation, and use of the state budget; tighten financial discipline; continue to restructure public investment spending; prioritize resources for important and urgent tasks and national key projects, strive to disburse public investment rate higher than last year, minimize capital transfer and arrange enough resources to implement salary policy reform from July 1, 2024.

Fourth, strictly control state budget overspending, public debt, and contingent debt obligations to adhere to safety limits; continue to implement solutions to restructure the public debt portfolio in a safe and sustainable direction.

Fifth, ensure the stable and safe operation of the financial market and financial services; strictly handle violations and promote fair competition among economic sectors.

In addition, drastically, substantially and effectively implement enterprise restructuring, equitization and divestment of state capital associated with governance innovation according to advanced standards; substantially improve the business investment environment, reform administrative procedures, and enhance national competitiveness; proactively integrate into international finance and improve the effectiveness of foreign affairs. At the same time, continue reform, restructuring, personnel streamlining and reform of financial mechanisms of public service units along with strengthening financial and budgetary discipline in public service performance.

In the immediate future, in the coming short time, we will focus on managing financial and state budget tasks during the 2024 Lunar New Year to ensure production and business activities before, during and after Tet; and drastically deploy the collection and spending tasks in 2024 from the beginning of the year to achieve set goals.

Thank you very much, Minister

By Thu Hien (Interviewed)/ Huyen Trang

Related News

Finance sector accomplishes financial and budgetary tasks in 2023

Finance sector accomplishes financial and budgetary tasks in 2023

VCN – The Ministry of Finance held a conference to review the financial and budgetary tasks in 2023 and set out task for 2024. Minister of Finance Ho Duc Phoc chaired the conference.
The 30th APEC Finance Ministers

The 30th APEC Finance Ministers' Conference was a great success

VCN - As part of the 2023 APEC Finance Ministers' Process, the 30th APEC Finance Ministers' Conference was held in San Francisco, USA. Receiving the invitation of US Finance Minister Janet L. Yellen, Minister Ho Duc Phoc led the Vietnamese delegation of the Ministry of Finance to attend the Conference.
Minister of Finance states reason for not abolishing compulsory insurance for motorbikes

Minister of Finance states reason for not abolishing compulsory insurance for motorbikes

VCN - At the question and answer session on November 6, National Assembly delegate Huynh Thi Phuc (Ba Ria - Vung Tau delegation) asked about the Ministry of Finance's opinion on abolishing compulsory motorbike insurance.
Handling public assets to ensure effective use

Handling public assets to ensure effective use

VCN- On the morning of November 6, under the chair of National Assembly Chairman Vuong Dinh Hue, the National Assembly implemented the question-and-answer session. At the session, National Assembly delegates were intersected in the public asset management and asked Minister of Finance.

Latest News

Vietnam acts to combat money laundering, terrorist financing

Vietnam acts to combat money laundering, terrorist financing

Deputy Prime Minister Le Minh Khai on February 23 signed a decision promulgating the national action plan to implement the Government's commitment to prevent and combat money laundering, terrorist financing, and financing of the proliferation of weapons of mass destruction.
Banks ask central bank to extend June 30 payment deadline

Banks ask central bank to extend June 30 payment deadline

Industry experts said the current challenging economic situation and difficulties faced by businesses severely affect their ability to meet debt obligations. As there are no shortcuts to resolving old bad debts, a significant number of newly classified bad debts, which should be expected on June 30 this year, will put tremendous pressure on the country’s financial sector, as well as businesses.
Efforts to remove obstacles to upgrade the stock market

Efforts to remove obstacles to upgrade the stock market

VCN - According to the sharing of Ms. Vu Thi Chan Phuong, Chairwoman of the State Securities Commission (SSC), in addition to completing the main criteria of international rating organizations in upgrading the stock market (TTCK), the State Securities Commission (SSC) continues to improve domestic regulations on the basis of researching international regulations and practices to promote Vietnam's stock market to develop in a sustainable direction, creating a favorable environment to attract international investors and foreign indirect investment capital flows.
The State Treasury implements nine key tasks in 2024

The State Treasury implements nine key tasks in 2024

VCN - The deployment of key tasks plan in 2024 (refer to the Plan) of State Treasury was issued to focus resources on completing tasks during the year and following the proposed strategies.

More News

SBV injects large amount of money to support capital for banks

SBV injects large amount of money to support capital for banks

The State Bank of Vietnam (SBV) on February 20 net injected more than 5 trillion VND (nearly 204 million USD) into the banking system through the open market operation (OMO) channel to support capital for commercial banks.
Vietnam Stock Exchange’s revenue down nearly 44% in 2023

Vietnam Stock Exchange’s revenue down nearly 44% in 2023

The Vietnam Stock Exchange (VNX) reported revenue of over 1.92 trillion VND (78.26 million USD) in 2023, down nearly 44% compared to the previous year.
Focusing on five tasks so that the securities industry continues to develop in the face of intertwined opportunities, challenges

Focusing on five tasks so that the securities industry continues to develop in the face of intertwined opportunities, challenges

VCN - Deputy Minister of Finance Nguyen Duc Chi raised five tasks that need to be focused in 2024 so that the securities industry continues to develop in the face of intertwined opportunities and challenges.
Prioritizing the allocation of public investment capital

Prioritizing the allocation of public investment capital

VCN - Public investment in 2024 continues to set a disbursement target of at least 95% of the total of more than VND657,000 billion of assigned public investment capital. Thus the task is to focus on allocating capital quickly and reasonably right from the beginning of the year.
6,144 retail petroleum stores issue invoices after each sale

6,144 retail petroleum stores issue invoices after each sale

VCN - According to the latest statistics of the General Department of Taxation, as of February 1, 2024, the country has 6,144 retail petroleum stores issuing electronic invoices after each sale.
PM Chính instructs action for stock market upgrade

PM Chính instructs action for stock market upgrade

Efforts have been made to attract investment and promote the image of the Vietnamese stock market, with the goal of upgrading it from frontier to emerging status.
Cai Mep – Thi Vai port gets very busy right from the beginning of Tet

Cai Mep – Thi Vai port gets very busy right from the beginning of Tet

VCN - Many mother vessels made landfall at Cai Mep – Thi Vai port (Ba Ria – Vung Tau province) in the early days of Dragon Year 2024 showing positive signs about the recovery of seaport activities.
Public offerings key to promoting corporate bond market: experts

Public offerings key to promoting corporate bond market: experts

To promote the professional corporate bond market, one solution is to focus on widespread public offerings of corporate bonds rather than private placements, said experts.
New policy may have adverse impacts on bancassurance

New policy may have adverse impacts on bancassurance

A new regulation on banning commercial banks from selling insurance together with banking services will negatively affect banks’ bancassurance revenue in the future, some analysts have claimed.
Read More

Your care

Latest Most read
Vietnam acts to combat money laundering, terrorist financing

Vietnam acts to combat money laundering, terrorist financing

Deputy Prime Minister Le Minh Khai on February 23 signed a decision promulgating the national action plan to implement the Government's commitment to prevent and combat money laundering, terrorist financing, and financing of the proliferation of weapons of mass destruction.
Banks ask central bank to extend June 30 payment deadline

Banks ask central bank to extend June 30 payment deadline

Industry experts said the current challenging economic situation and difficulties faced by businesses severely affect their ability to meet debt obligations. As there are no shortcuts to resolving old bad debts, a significant number of newly classified bad debts, which should be expected on June 30 this year, will put tremendous pressure on the country’s financial sector, as well as businesses.
Efforts to remove obstacles to upgrade the stock market

Efforts to remove obstacles to upgrade the stock market

VCN - According to the sharing of Ms. Vu Thi Chan Phuong, Chairwoman of the State Securities Commission (SSC), in addition to completing the main criteria of international rating organizations in upgrading the stock market (TTCK), the State Securities Com
The State Treasury implements nine key tasks in 2024

The State Treasury implements nine key tasks in 2024

The deployment of key tasks plan in 2024 (refer to the Plan) of State Treasury was issued to focus resources on completing tasks during the year and following the proposed strategies.
SBV injects large amount of money to support capital for banks

SBV injects large amount of money to support capital for banks

The State Bank of Vietnam (SBV) on February 20 net injected more than 5 trillion VND (nearly 204 million USD) into the banking system through the open market operation (OMO) channel to support capital for commercial banks.
Mobile Version