HCMC: Many taxes saw the lowest growth in three years

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Revenue of Ho Chi Minh City (HCMC) Tax Department reached more than 50 percent. Photo: T.H

According to HCMC Tax Department, in the first seven months of 2019, many taxes contributing main revenues to the State budget have increased compared to the same period last year but saw the lowest growth in the recent three years. In particular, revenue from corporate income tax (CIT) rose by 8.02 percent from the same period last year and was the highest rate of revenue among three main of revenues.

However, this was the lowest growth rate in the last three years of this revenue (in the first seven months of 2018, it increased by 16.69 percent compared to the same period in 2017; in the first seven months in 2017, it increased by 17.37 percent compared to the same period in 2016) because some key enterprises had low payments or did not make payments.

Most enterprises which made large payments made low CIT payments in the seven months of 2019.

Revenue from value-added tax (VAT) rose 7.93 percent over the same period last year and was revenue that the payment of enterprises in all sectors increased compared to the same period last year. Special consumption tax (SCT) in the first seven months of 2019 rose by 3.1 percent over the same period last year, mainly from enterprises engaged in producing and trading items such as beer, wine and cigarettes (revenue of these sectors accounted for 77.95 percent of the total revenue from special consumption taxin the first seven months of the year) and due to the increase in the SCT rate on cigarettes as described.

Revenue from personal income tax(PIT) rose by 11.83 percent over the same period last year, the growth was mainly due to the increase in PIT from wages and salaries, which was also the highest proportion revenue of total PIT revenue (accounting for 80.26 percent).

According to HCMC Department of Taxation, although PIT revenue had higher growth than the same period last year, this was the lowest growth rate in the last three years (in the first seven months of 2018, it saw a year-on-year increase of 23.58 percent and in the first seven months of 2017, it saw a year-on-year increase of 20.41 percent) due to the 18.52 percent reduction in PIT revenue from real estate compared to the same period last year. If excluding the reduced PIT revenue from real estate, PIT revenue rose by 15.46 percent over the same period last year.

Besides, many revenues fell sharply over the same period last year. Specifically, revenue from land use fees decreased by 52.43 percent. It was due to that in 2018, there were many new real estate projects, making revenue from land use fees in 2018 reach good growth.

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According to HCMC Tax Department, the low growth rate of main taxes affected the State budget revenue. In the first seven months of 2019, total domestic revenue was VND 162,684 billion, amounting to 56.0 percent of the 2019 estimate, up 1.57 percent over the same period of 2018.