An estimated VND577 trillion (US$24.86 billion) was collected for the State budget in the first five months of the year, equal to 38.2% of the estimate and down 9.2% compared to the same period last year.

According to the State Budget Department under the Finance Ministry, the COVID-19 pandemic, although already put under control in Vietnam, is still raging in many big trade partners of Vietnam such as the US and the EU, thus greatly affecting budget revenues and spending.

Specifically, domestic revenues dropped 5.9%, revenues from crude oil were down 17.8% and from import-export activities down 23.4%.

Budget collection from half of the revenue sources has not met the set target. Collection from the State-run sector met only 33.4% of the estimate, and that from the foreign-invested sector met just 37.5% of the estimate.

Tax revenue is also on the decline, including revenue from value-added tax, special consumption tax and corporate income tax.

Another reason behind the decrease in budget collection is the policy to postpone the payment of tax and land use fees for enterprises, organisations and business households affected by COVID-19. As of the end of May, the amount of delayed tax amounted to VND37 trillion (about US$1.6 billion).

Meanwhile, State budget spending in the five-month period was estimated at VND603.4 trillion, or 34.5% of the estimate. Spending on development investment reached only 26% of the estimate.