Vietnamese enterprises will soon overcome the difficulties they are currently facing, Nguyen Ngoc Hoa, a member of the National Assembly Economic Committee, told the Vietnam Economic Times.
Some people say the Government's decision to lower the corporate tax rate for enterprises by 3 percentage points is not sufficient. What do you think?
Tax reduction is one of several measures the Government has taken to help enterprises overcome their difficulties. The cut of 3 percentage points (from 25 per cent down to 22 per cent) in corporate tax is a positive sign.
It will leave enterprises more money to invest in their businesses. Helping weak businesses and those on the verge of going bankrupt will take a number of measures, not only tax reductions.
I agree with some ideas that crippled enterprises won't have money to pay corporate taxes. The rate cut is too little for them. However, the Government's decision indicates: "We're with you and support you".
As a businessman, what support do you want from the Government?
The Government has tried hard to find ways to help enterprises recover besides tax reduction: restructuring the State-owned enterprises, helping enterprises to reduce their inventories and others.
As far as I know, soon the government will reduce value added tax (VAT), delay debt repayments for enterprises and others. These measures will help enterprises overcome difficulties and little by little they will recover.
In my opinion, the Government should take three measures at the same time: support enterprises; help them reduce their inventories and reduce VAT, personal income tax and the prices of some essential commodities.
What's your forecast for the "health" of enterprises and recovery of the economy?
The current difficulties are only temporary. With support from the Government, enterprises will soon overcome the hard times and resume their normal business.
However, enterprises should take the initiative and restructure their businesses.
The Law on Corporate Income Tax is being revised. What message do you want to send to the drafting committee?
I would like the law to exempt at least 20 per cent of the tax levied on profits gained by co-operatives to help them re-invest in production/business expansion. I also would like to avoid imposing a ceiling on the money they spend on advertising and promotions. I don't think spending on advertisement or promotion would create a loophole for transfer pricing as many people have said. The best way to prevent transfer pricing is to improve the management skills of government officials. — VNS