(VNS ) Enterprises need to stand firm on their own two feet, Dr Nguyen Tien Loc, Chairman of the Viet Nam Chamber of Commerce and Industry (VCCI) told the Thoi bao Kinh doanh (Business Times). newspaper.
To help enterprises overcome difficulties, the government has presented a number of proposals to the National Assembly, including reductions in corporate income tax (CIT), value added tax and spending on advertisement and promotions. What are your comments on these proposals?
I must say these measures will push enterprises to recover their weak health.
In Resolution 2, the government introduced a number of measures to help enterprises overcome their difficulties in the context of the economic slowdown. The question now is how to turn them into reality as quickly as possible.
A survey on local management capacity conducted recently by the VCCI showed that local authorities gained a lot of experience in the process of reforming administrative procedures.
This is a very precious lesson for them.
In the context of the economic slowdown, it is impossible to ask the government to come up with many incentive packages to help the economy recover the old pace of economic development. As we all know, the state and the government's resources are limited.
Some National Assembly deputies have argued that the current CIT in our country is only average compared with that of other regional countries. They said the decision to cut CIT to 22 per cent from 25 per cent is reasonable. What do you think?
Well, I first want to say, tax reduction is a good and effective decision.
However, if the cut is only 3 per cent, that is a bit small. I think 5 percent (20 per cent in CIT) is the right number. It will help enterprises overcome their present difficulties.
Regarding the comment made by some legislators that 22 per cent was a popular level in the region, "Why should Viet Nam cut CIT to 20 per cent?" Yes, I couldn't agree more.
But our business environment is different from theirs. That difference has made the business cost in our country higher than that of other regional countries.
For example, our infrastructure is poorer than that of other countries. Our supporting industry is at a lower level than theirs. Our workers' performance is lower than that of our regional peers.
The State Bank of Viet Nam (SBV) has made public a draft decree to make room for foreign investors and to issue non-voting shares. Do you think that the decree will motivate more foreign investors to come to Viet Nam?
More domestic and foreign investment is very important for our economic growth and development.
Thailand is a good example for us to learn from. Their lessons can be valuable to us. For example, when establishing new enterprises, companies issue non-voting shares in order to attract capital from overseas.
How did foreign investors react to the SBV Decree?
Generally speaking, both local and foreign investors are positive about our country's investment environment. I strongly believe if the government continues its efforts to curb inflation, restructure the economy - particularly State-owned enterprises – and create conditions for private and foreign firms to develop, the nation's economy will soon recover. — VNS