Minister of Finance asks IMF to support Vietnam in applying global minimum tax

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Minister of Finance Ho Duc Phoc speaks at the meeting.

Speaking at the meeting, Minister of Finance Ho Duc Phoc congratulated Mr Jochen Schmittmann, Deputy Director of the IMF OPA Office in Japan, who will assume the new position of Chief Representative of the IMF in Vietnam starting the coming August (replacing Mr Francois Painchaud).

Affirming that the IMF is an important partner for Vietnam in general and the Ministry of Finance in particular, the Minister said that the Ministry of Finance recognized the close and effective cooperation of the IMF over the past time.

At the meeting, informing about Vietnam's macroeconomic situation, Minister Ho Duc Phoc said that in 2022, Vietnam's economy would achieve many great achievements despite having just experienced 2 years of pandemic and economic growth reaching 8.02%. This is high growth. Entering 2023, the socio-economic situation in the first 5 months of the year is relatively difficult. Average CPI in 5 months increased by 3.55% over the same period; the trade surplus reached 9.8 billion USD, etc.

Work session scene.

From now to the end of the year, it is forecasted that the world and domestic economic situation will still face difficulties and challenges, so the Ministry of Finance will continue to focus on operating fiscal policy proactively and flexibly to remove difficulties for businesses and people, promptly respond to practical developments, actively contribute to stabilizing the macro-economy, controlling inflation, and promoting the recovery of socio-economic development.

Regarding the direction of fiscal policy in the coming time, Minister Ho Duc Phoc said that the Prime Minister had approved the Financial Strategy for 2030, which sets the following goals: the mobilization rate. The average impact on the state budget in the period 2021-2023 is not lower than 16% of GDP, and in the period 2026-2030, about 16-17% of GDP; the proportion of domestic revenue in total state budget revenue by 2025 is about 85-86%, by 2030 about 86-87%; the average rate of state budget deficit in the period 2021-2025 is 3.7% of GDP, by 2030 down to about 3% of GDP; annual public debt ceiling, in the period 2021-2025 no more than 60% of GDP, government debt does not exceed 50% of GDP, the foreign debt of countries does not exceed 50% of GDP.

To achieve the above goals, Minister Ho Duc Phoc suggested that the IMF continue to accompany, support and advise on policies for the Ministry through macroeconomic monitoring missions and provide technical assistance to reform public financial management and improve the capacity of the Ministry of Finance staff.

Accordingly, the Minister suggested that the IMF continue to provide documents, international experiences, and policy advice on some issues such as expenditure on source transfer; the regime of management of revenue from the land; the management mechanism of national target programs; formulating property tax policies; Tax Administration; public debt management; stock market management; corporate bond management, especially individual corporate bonds.

At the same time, Minister Ho Duc Phoc also suggested that the IMF pay special attention to and support the Government of Vietnam in general and the Ministry of Finance in particular in implementing the application of the global minimum tax.

Mr Francois Painchaud, IMF Representative in Vietnam, spoke at the meeting.

Speaking at the meeting, Mr Francois Painchaud, IMF Representative in Vietnam, said that regarding public debt management, value-added tax refund and tax fraud prevention, the IMF side has been having issues technical assistance program of the Ministry of Finance of Vietnam in the these fields and will continue to note and discuss with experts of the IMF to further support in the coming time.

In addition, the IMF is willing to exchange, support or coordinate with strong parties to provide technical assistance to the Ministry of Finance of Vietnam in managing the corporate bond market.

Also, at the meeting, Mr Jochen Schmittmann affirmed that during his official work in Vietnam from August 2023, he will continue to make contributions to promote the cooperation relationship between the IMF and the Ministry of Finance closely and effectively.