Thinking on the bright side

December 30, 2011 | 14:25
(0) user say
The Ministry of Planning and Investment forecasted around 12,000 firms will be dismantled in 2012 against 7,000 dissolved firms in 2011.

General Department of Taxation head Bui Van Nam tells VIR why he believes the tax sector’s contributions to state coffers could surge 5-8 per cent in 2012 against projections.

2012 is forecast to be another year full of hardships for Vietnam’s economy. Why do you believe state budget revenue could still hike 5-8 per cent against projection?

2011 was a tough year for firms, but collections from local sources not including crude oil amounted to VND425 trillion ($20.2 billion), surging 11.3 per cent against projection tantamount to VND43 trillion ($2.04 billion). If land rental was excluded, budget revenue was VND381.5 trillion ($18.16 billion), up 8.4 per cent against projection and hiking 21.3 per cent against 2010. That was why we believe we could outperform budget revenue target if consistent measures on tax management were taken right from early year.

To make the goal come true, unlike the previous years, in 2012 budget revenue hikes will be based in rising contributions from localities. Accordingly, localities with collections exceeding VND10 trillion ($476 million) shall strive for 5 per cent hike, those with collections from VND3 trillion ($142.8 million) to less than VND10 trillion strive for 8 per cent hike and those with collections of less than VND3 trillion strive for more than 10 per cent hike in actual collections.

What will be 2012’s budget target?

In 2012, under the National Assembly’s assignment the tax sector is obliged to contribute VND494.6 trillion ($23.55 billion) tax revenue not including crude oil to state coffers. If land rental was excluded, the figure would be VND475.6 trillion ($22.6 billion), 20 per cent upsurge against 2011. This is quite a hard task since 2012 would be another hard year for businesses and the economy.

Notwithstanding, the tax sector will try its best to outdo budget revenue target by 5-8 per cent. Besides, we will focus on expediting the government’s macroeconomic solutions, reforming and modernising the tax sector in light of tax system reform strategy for 2011-2020, implementing diverse solution packages to fight against corruption and wastes and exercising thrifts. Priority will be given to fostering discipline among tax officials.

How will these focal targets be met?

We have set forth 24 concrete measures to materialise these focal targets. Accordingly, checks and inspection will be ramped up at allied and joint venture firms, firms with signs of involving in transfer pricing cases and those enjoying scores of tax incentives.

Besides, bettering tax arrear management efficiency is another focus to raise contributions to state coffers. We will continue pushing up tax procedure reforms to trimmer unnecessary procedures, promoting e-declarations with a view to having at least 150,000 firms making tax declarations online in 2012, up 85,000 firms against 2011. Applications of IT progress into tax management will be boosted, particularly in personal income tax management.

What is your comment on tax incentive measures?

Budget revenue will hike in a sustainable manner when firms have stable production and business. Hence, we will seriously abide to state regulations on tax reductions, exemptions in light of Ministry of Finance’s Circular 154/2011/TT-BTC supplementing some tax measures to ease individuals’ and firms’ difficulties.

Though the tax amount is subject to be reduced, exempted or extended is not big (VND13.379 trillion or $637 million in 2011 and VND5.412 trillion or $257.7 million in 2012) it helps reduce firm burdens and save costs for production and business expansion.

By Manh Bon

vir.com.vn

What the stars mean:

★ Poor ★ ★ Promising ★★★ Good ★★★★ Very good ★★★★★ Exceptional

Latest News