Therefore, according to him, if the tax legal framework is properly adjusted, the state budget will have more stable revenues.
Experts continued forecasting that the country would still face many difficulties in 2024; thus, having additional revenue sources to ensure budget balance is a challenge to authorities in addition to the improvement of tax collection efficiency.
Associate Professor Vu Sy Cuong revealed that the current budget depends heavily on land revenue, especially local budgets. Therefore, if the government corrects the irrationalities in the current budget collection system, the country can absolutely increase revenue steadily. Personally, he believed that from now until 2030 there are many issues that must be done to balance the budget, including amending and supplementing tax regulations.
According to Mr. Cuong, the special consumption tax, especially the tax rates, are the most unreasonable. Besides, in the context of the global minimum tax being applied from January 1, 2024, not only corporate income tax but many other taxes should be reviewed.
In his opinion, tax reform is carried out a bit slowly because taxes are no longer an effective tool to attract investment. Many countries have seen this problem in advance when trends change. The current nominal tax rate for foreign invested enterprises is 20 percent, but in reality, it is only about 12 percent-13 percent.
Therefore, how to retain and attract more investment is a difficult problem. The trend of protecting domestic production is growing stronger again, so appropriate policies must be taken into account to protect domestic goods. Additionally, it's time to apply a carbon tax as many countries have applied it to limit emissions.
Since Vietnam is aiming for Net Zero by 2050, it will need this tax. When budget revenue is not enough to ensure payment for public services, the concept of ‘ social contributions’ is used to refer to people making additional contributions when using public services, which in essence is also a mandatory revenue. He supposed that the current tax and fee system is placing the greatest burden on the upper and middle income classes, whereas the present tax system is very much in rich people’s favor.
Mr. Cuong also said that the amendment and supplementation of the Personal Income Tax Law has been proposed to be included in the National Assembly's law-making program in 2024. It is necessary to review and amend taxes related to real estate, special consumption tax, and carbon tax and the government must carefully study how to amend it.
Regarding the question that the foreign debt surplus is still quite large, which can be a good source of additional credit, contributing to the country’s growth promotion, Association Professor Cuong said that current debt criteria are all within safe limits, so he thinks ODA loans are also a possible option, but the government still has to be cautious and carefully calculate costs, because sometimes loans are attached with conditions which means that the loan seems to have a low interest rate but in reality it is not so low.
On the other hand, currently, domestic credit sources are still quite abundant, and the credit limit has not been used up yet. Last but not least, government bonds can be issued. In short, he thinks that the source of money is not the biggest problem for investment, but whether we can spend the money in the most effective way or not.
Moreover, according to the National Assembly’s Resolution No. 104/2023/QH15 on state budget estimates for 2024, the estimated state budget revenue for 2024 is VND1,700,988 billion (US$70,140,419,327). Revenue transferred from the local budget's salary reform until the end of 2023, the remaining balance transferred to the 2024 budget allocation of some localities is VND 19,040 billion to implement the base salary of VND 1.8 million per month. In comparison with the 2023 estimate, the 2024 state budget revenue estimate increases by VND80,100 billion (about 5 percent).
However, the General Statistics Office said that state budget revenue in 2023 is estimated to decrease by 5.4 percent on December 29, 2023 while state budget expenditure is estimated to increase by 10.9 percent compared to 2022.
