Tax collection below target makes balancing the budget a challenge

HA NOI (VNS)— Overdue taxes in the first nine months of the year reached a level of 6.8 per cent of total tax collections, with amounts owed by State-owned enterprises accounting for over 13 per cent of the total.

General Department of Taxation deputy director Tran Van Thu released the figures at a meeting held in Ha Noi yesterday to review State budget utilisation so far this year .

"The ministry has strived to bring the debt ratio to less than 5 per cent to ensure a balance between State budget collections and spending," Thu said.

Total tax collections in the nine-month period were at 67 per cent of set targets, while total State spending amounted to VND643 trillion (US$30 billion), or 4.5 per cent increase over the same period of last year.

Value-added tax payments have also been extended for over 190,000 businesses, representing uncollected taxes totalling VND11 trillion ($523.8 million), while corporate income taxes have been delayed for 71,000 companies, for an additional total of VND2.9 trillion ($138 million).

Uncollected land use fees were also estimated to have totalled VND250 billion ($11.9 million) by the end of September.

Deputy Minister of Finance Vu Thi Mai also told the meeting that the Ministry of Finance had established a unit to review corporate income taxation, proposing a rate less than the current 25 per cent.

"The specific figure would have to be carefully considered to ensure competitiveness in the region," Mai said.

She also told the meeting that the ministry had submitted to the Government a draft circular to provide guidelines on the revised Law on Securities. The ministry was also co-operating with the State Bank of Viet Nam to develop the stock market. — VNS