According to the draft documents of the 13th National Party Congress that have been publicly consulted, the draft assessment report on results of implementing the 5-year socio-economic development task for the 2016 – 2020 period and the 5-year socio-economic development task for the 2021-2025 period, has presented many important objectives of the fiscal task.

Photo: Thuy Linh 

Assessing the results of implementing the 5-year socio-economic development task for the 2016 – 2020 period in the financial and budget area, the draft report stated that the revenue structure has had a positive change in the direction of increasing the rate of domestic revenue, ensuring capital spending in accordance with estimates, gradually increasing spending for development and investment,lowering recurrent spending and ensuring targets of budget deficitand public debt.

The financial and budget discipline has been strengthened. Revenue management, revenue source exploitation and tax base expansion have been focused in association with enhancing the fight against revenue loss, smuggling and trade fraud; drastically handling tax debts and strengthening tax inspection, thereby contributing to ensuringthe mobilization rate to the state budget to meet the set target.

In the 2016-2019 period, the mobilization rate for the state budget averaged 25.5% of GDP, higher than the average rate of the 2011-2015 period (23.4% of GDP). It is estimated that in the 2016-2020 period, the mobilization rate for the state budget is about 24.5% of GDP.

The rate of domestic revenue in the 2016-2020 period accounts for about 81.6% in total state budget revenue, higher than the 2011-2015 period (68%). It is expected that by 2020, this rate will be about 84.3% in accordance with the direction of increasing the rate of domestic revenue. Capital spending is performed strictly, economically and as scheduled.

Of which, the spending rate for investment and development increased to 27-28%, the recurrent spending rate fell from 63 - 65% in the 2011-2015 period to about 62-63%, while increases in salary, pensions, benefits for people with meritorious services and other social policies, priorities to the fields of education and training, health, national defense and security were still ensured.

At the same time, to carry out the roadmap for calculating public non-business service prices and calculate the salary costs, direct costs in service prices according to the capacity of the state budget and people’s income.

Budget deficit and public debt was controlled and decreased compared to the previous period. State budget deficit in the 2016-2019 period reached 3.5% of GDP, decreasing compared to the 2011 – 2015 period (5.4% of GDP), it is expected that by 2020 the state budget deficit will be about 4.99% of GDP.

Since 2017, thanks to a decrease in the state budget deficit, tightening of loans and government guarantees, public debt started to decline.

By the end of 2019, the estimated debt rate was about 55% of GDP, the government debt was about 48% of GDP and the country's external debt was about 47.1% of GDP, within the corresponding allowable limit of no more than 65% of GDP; 54% of GDP and 50% of GDP, respectively.

Due to the impact of the Covid-19 pandemic, the budget revenue will be likely to be lower than expected and supportive policies for health, production, business and social security will raise spending, leading to a state budget deficit.

The public debt rate is expected to increase to about 56.8% of GDP by 2020, but it will still contribute significantly to stabilizing the macro-economy and improving the national credit rating. In particular, public debt has been restructured in the direction of expanding loan terms, the proportion of domestic loans and reducing external loans.

Setting targets for the next period, the draft stated: average GDP growth rate for the 2021 - 2025 period is expected to be about 6.5-7%. The GDP per capita by 2025 is to reach US$4,700-5,000. The rate of processing and manufacturing industries in GDP will reach over 25% and the digital economy will make upabout 20% of GDP.

Regarding major economic balances, the targets set out are to promote economic growth on the basis of macroeconomic stability; to promote the increase of total accumulation of assets, accounting for about 27-28% of GDP and to maintain the final consumption rate not lower than 73 - 74% of GDP. The total average social investment capital for five years will be about 32 - 34% of GDP.

The mobilization rate for the state budget for the 2021 - 2025 period will be 15-16% of GDP. Public debt will drop to about 47.5% of GDP by 2025. Government debt will be about 43.8% of GDP by 2025. State budget deficit in the 2021 - 2025 period will average 3.7% of GDP. National energy balance will also be ensured.