Construction is underway at the An Sương Underpass, a crucial infrastructure project for HCM City, the southern economic hub. — VNA Photo

HÀ NỘI — Việt Nam's budget collection has seen a sharp fall during the first six months of 2020 at just 44.2 per cent of projected income, a 10.5 per cent drop compared to the same period last year, said the Ministry of Finance in an online meeting with Prime Minister Nguyễn Xuân Phúc in Hà Nội yesterday. 

Contributing factors included falling revenue from crude oil, which barely reached 60 per cent of projected income.

Budget collection from domestic firms also fell by 7 per cent. The hardest-hit came from State-owned firms which saw a drop of 21.5 per cent compared to the same period last year, followed by the private sector and FDI with 15 per cent and 6.3 per cent, respectively.

This, according to the finance ministry, was an accurate reflection of the hardship faced by the economy due to the disruption caused by COVID-19.

Measures have been taken to provide firms with support. By the end of June, Viêt Nam's tax authorities processed nearly 150,000 tax and land-use fee relief applications extending an amount of VNĐ43 trillion (US$1.85 billion) in credit for firms and business households. 

During the first half of 2020, the State spent over VNĐ15.3 trillion on COVID-19 prevention activities (VNĐ4.1 trillion) and in support of 11 million affected households (VNĐ11.3 trillion).

Investment accounted for 33.1 per cent of total budget spending with borrowing cost and normal expenditure accounting for 50.3 per cent and 48.2 per cent respectively.

Despite experiencing setbacks, Việt Nam's stock market has yet to see any significant capital outflows. The market has remained stable and on its track to recover strongly as COVID-19 was put under control, showing investors' confidence in the country's long-term growth potential.       

On administrative reform, the ministry has removed 28 procedures with 560 others that have been made available online. Most firms (99.6 per cent) have started to use electronic tax forms.

Speaking at the meeting, PM Phúc said the ministry must stay proactive in their approaches to balance the State's budget while, at the same time, create momentum for the economy to recover and achieve sustainable growth. 

"We must stand behind and support new business models, new materials, new energies and new drivers for economic growth," he said.

The leader ordered government agencies to increase effort to improve transparency, reduce risk and combat illegal economic activities and violations. He insisted on the importance of keeping inflation under 4 per cent this year, in line with a recent National Assembly decision. 

In addition, the PM urged the finance ministry to help speed up the disbursement of public investment capital, saying the country's objective was to spend up to $30 billion in 2020. 

He asked the Ministry of Finance and the Ministry of Planning and Investment to hold regular meetings to identify bottlenecks and difficulties in the disbursement process. He also called for the forming of central government task forces to inspect slow-moving projects across the country under the direct supervision of the ministers. Localities and ministries failing to keep up the pace by August will risk losing their investment to others. — VNS