HCM City: reform and raise budget revenues

The state revenue from imported cars decreases in 2018. Photo: T. H

Domestic revenue increases nearly 16%

According to the Chairman of the HCM City’s People’s Committee Nguyen Thanh Phong, the Central Government and HCM City’s People’s Council assigned the revenue collection target of VND 376,780 billion to HCM City, up 8.31% from the estimate in 2017 and up 8.27% from the achieved revenue in 2017. In which, the domestic revenue is VND 256,210 billion, up 15.74% over the achieved result in 2017, the revenue from import and export is VND 108,000 billion, down 1.01% from the achieved result in 2017.

Mr. Nguyen Thanh Phong said that it was forecasted that in 2018, though the world’s economy continued the tendency of improvement and deep integration, it still had potential difficulties and challenges. The state revenue collection target in 2018 is very high, “as my calculation, if excluding Sundays, HCM City must collect VND 1,203 billion per day. This is a big challenge for HCM City in general and its financial units in particular,” Mr. Nguyen Thanh Phong shared.

According to Phong, to achieve this end, HCM City must start from production. Thus, HCM City must focus on solutions and policies approved by the National Assembly and listen to enterprises to improve the investment environment and always try to develop. On 29^th December 2017, HCM City signed a decision to establish an Inter-sectorial group on investment lead by the Chairman of HCM City’s People’s Committee in order to provide best support to investors towards administrative reform in the most effective and streamlined way.

Under the leaders of HCM City Department of Finance, to raise and diversify revenues, in 2018 the city’s finance sector will concentrate on reviewing the reality, studying and proposing the People’s Committee a scheme on applying fee and charges which have not listed; a scheme on increasing fees and charge level or rate decided by the competent authorities for fees and charges in the list to submit to HCM City’s People’s Council for approval. Another important solution is collaborating with the central ministries to review and re-arrange land owned by the State and managed by the central agencies in the city and proposing the Government a solution to create revenues for the state budget.

Revenue decreased due to FTAs

According to HCMC Customs Department, in 2018 there will be many factors affecting the state revenue from some key commodities of HCMC. Accordingly, from 1^st January 2018, imported cars with less than 9 seats from ASEANFTAs member countries, will be subject to an import duty rate of 0%. FTA tariffs are declining. It is expected that in 2018, the country’s revenue from goods imported from FTAs member countries will reduce to about VND 30,150 billion, and HCMC in particular, will reduce to about VND 11,000 billion. Besides, the State applies safeguard duties and anti-dumping tax, which will restrict imported goods

From the above reality, HCMC Customs Department realizes that the state revenue collection in 2018 is a very difficult political task, which requires breakthrough solutions. In which, HCMC Customs Department will evaluate the performance efficiency of trade facilitation agencies, thereby continuing to implement the Plan No. 494 / KH-HQHCM on the program, "Business community and Customs are reliable partners and work together for mutual development in 2018,"to provide maximum support to the business community to comply with the Customs law and contribute a large tax payment to the state budget. Strengthen the once ruling operation for enterprises to use the ruling result several times for the same products or similar products. Creating the trust in the business community to accompany the HCMC Customs Department and to raise state budget revenue.

Regarding the modernization and reform, the Department will continue to do the besttrade facilitation plan, to shorten the Customs clearance time from 108 hours to 70 hours for exported goods, and from 138 hours to 90 hours for imported goods. From the beginning of the year, HCMC has deployed the Automated System for Seaport Customs Management. This helps import and export enterprises reduce paper documents exchanged with carriages as well as Customs authorities. Accordingly, reducing burden on declaration, accelerating Customs clearance process and saving costs.

Especially, regarding the specialized inspection barrier, following Decision No. 2026/QD-TTg dated 17^th November 2015 of the Prime Minister on specialized inspections, in 2018, HCMC Customs Department must strive to decline Yellow Channel rate from 38% to below 20%. Effectively applying the analysis of risk management; enhancing scanning before, during and after clearance for containers with suspicion of trade fraud and smuggling; collaborating with competent authorities to promptly prevent acts of smuggling and trade fraud; and striving to reach the target of VND 108,000 billion.