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Tax collections expected to double

Update: January, 13/2011 - 09:56

HA NOI — The General Department of Taxation has targeted increasing total tax collections from Vietnamese households and businesses for the 2011-15 period to at least 1.9 times the amount received in the 2006-10 period.

Taxes from both foreign and domestic business activities, excluding crude oil and land, are targeted to rise 2.2 times from the previous period.

Minister of Finance Vu Van Ninh said the economic outlook was positive and that reaching the targets was highly feasible.

He asked localities to create favourable conditions for businesses so that investment and production could be hastened.

This would lead to higher contributions to the State budget, he added.

Based on the impressive results of last year, the department expects to complete its targets for the 2011-15 period.

Figures from the department show that last year's total domestic tax collection was VND400 trillion (US$2 billion), an increase of 21.4 per cent over the same period in 2009.

Nguyen Van Nam, deputy head of the Taxation General Department, said that natural resources sectors, including crude oil and land, contributed lower amounts than the previous period.

The total tax collection was VND23 trillion ($1.15 billion) higher than in 2009, with taxes from business and production accounting for 72 per cent of the total domestic collection.

The contribution to the State budget from households, which was 37.5 per cent of the total, showed the highest growth rate of all sectors.

The household component saw an impressive rise, from 13 per cent for the 2001-05 period to 18 per cent for the 2006-10 period, with an annual growth rate of 31 per cent.

Nam said during the 2006-10 period a total of VND1,551 trillion ($77.5 billion) was collected, 2.5 times higher than the 2001-05 period.

The department said foreign direct investment accounted for 18 per cent of the State budget collection, with an annual growth rate of 26 per cent.

The proportion from the State economic sector fell from 35.5 to 30.8 per cent.

Phung Quoc Hien, chairman of the National Assembly's Finance Committee, said that higher tax collections had created opportunities to reduce spending.

He said the country should try to lower spending to less than 5 per cent of GDP in the next two or three years. — VNS

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