Temporarily reserve 50% of local budget reserve for preventing loss of revenue

Enterprises implement procedures at HCM City Taxation. Photo: Nguyễn Huế

Complete highest achievements in the State Budget collection task

In order to strive to achieve the highest results for State Budget collection and expenditure in 2018, as in the assigned budget, the Ministry of Finance requested the provincial People's Committees to direct the concerned authorities of the localities to coordinate with the tax authorities and the customs authorities in intensifying the management of collection in the localities, preventing losses, combating smuggling, trade frauds and transfer pricing; Reduce the rate of tax debt to below 5% of total revenue. Also, strictly implement the fiscal policies and conclusions as well as proposals of the audit and inspection agencies; Strive to complete at least 3% of the state revenue estimation in 2018 decided by the National Assembly.

The Ministry of Finance also requested the People's Committees of provinces and cities to direct the finance authorities to assist the People's Committees at all levels in managing state budget expenditure in accordance with the prescribed regime, within the assigned budget, ensuring savings and raising effectiveness; To review the social security regimes and policies, especially human expenses, so as to ensure that the expenses are paid to the right persons at the prescribed time.

In particular, the Ministry of Finance proposed that: The localities should take the initiative in managing in order to ensure balanced local budgets, implement budget expenditure in accordance with the current appropriation, budget revenue capacity and progress of some revenue sources in line with the expense estimates for investment development (land use fee, lottery); to take initiative in reserve revenue sources for implementing the State policies which have already been promulgated, reducing the source of central budget support.

At the same time, managing and using the projection of the local budget according to the provisions of the State Budget Law, focusing on the tasks of overcoming the consequences of natural calamities, storms, floods, epidemics and a number of other important urgent tasks; To fully and timely pay debts of the local budget and manage the debt in accordance with the ability to raise capital and ensure that the loan does not exceed the rate decided by the National Assembly and assigned by the Prime Minister.

Taking initiative in providing resources to balance budget

The Ministry of Finance noted that in cases where the collecting for local budget is lower compared to the current appropriation assigned by the higher competent authority, the local authority must take the initiative in developing a management plan in order to ensure the local budget balance, and prioritize the implementation of policies, regulations related to human rights, social security and poverty reduction.

Specifically, the localities actively use resources to balance local budget in the following order: reserve 50% of the estimated projection of local budget (in fact, to reduce the estimation of local budget expenditure); Other legal financial resources of the locality (financial reserve fund, budget balance, ...); a part of the source of residual salary reform (after ensuring the source to implement salaries in accordance with the base of 1,390,000 VND/month and social security policies,…).

In cases where after using lawful financial sources but they are unable to make up for the reduction of the local budget revenues, the locality must reorganize, cut, and reduce the spending tasks which have already been calculated in advance in 2018, and transfer to 2019 and other later years. In the course of managing the budget, if the case of temporary shortage of budget at all levels happens, the locality should promptly report to the higher authorities for consideration and handling.

For the budget expenditures, the Ministry of Finance requested the People's Committees of provinces and cities to speed up progress of budget expenditure, including expenditures for the regimes, policies, tasks and schemes under the key programs and national key programs. At the end of the budget year, only budget estimates which are not fulfilled or not fully paid under the Clause 3, Article 64 of the State Budget Law of 2015, shall be allowed to be transferred to the following year for implementation, the rest will be canceled from the estimate. The central government does not consider transferring or supplementing the resource in order to guarantee for these expenditures. Thus the localities must take the initiative in allocating local budgets to carry out the tasks arising in the locality in 2018.

Apart from a number of measures related to State revenues collections and expenditures, the Ministry of Finance requested the provinces to expeditiously implement measures to speed up the implementation and disbursement of capital, raising the efficiency in using public investment capital in 2018, boosting economic growth; To concentrate on implementing the scheme on restructuring SOEs in the period of 2016-2020; to speed up the progress of arrangement, equitisation, divestment. Furthermore, continuing to review and implement measures in order to reduce the charge and input costs for enterprises as directed by the Government, and raise the efficiency of enterprises' operation. At the same time, speed up the progress of the autonomous mechanism of public service delivery units in each domain, linking up with the promulgation of the roadmap for calculating public service delivery prices and restructure the State budget expenditure for those sectors.

Moreover, appreciating the "entry" of the localities in striving to accomplish the highest financial tasks - state budget, every year, the Minister of Finance issued a document to suggest the local authorities to promote the implementation of each specific task.

This can be considered as one of the important solutions that aims for promoting the localities together with the whole financial sector in striving to achieve the highest results of financial task – assigned State Budget.