All efforts are being made to boost production and business across the board, photo Le Toan

Prime Minister Pham Minh Chinh last week required the State Bank of Vietnam (SBV) to continue implementing a proactive and flexible monetary policy.

“The SBV must continue to reduce lending rates and increase credits in line with the real developments of the market, while boosting money supply into the economy when necessary. The credits must be focused into growth momentum including investment, consumption, and export,” PM Chinh stated.

In mid-July, PM Chinh also enacted Resolution No.105/NQ-CP on removing difficulties for enterprises, including stress laid on boosting administrative reform. Resolution 105 states that the SBV must specify a credit growth rate of at least 13-15 per cent for the whole of 2023.

“How to increase credits must be announced immediately via proper measures, with specific quota for credit growth for commercial banks until late 2023,” the resolution stated. “Sufficient capital must be provided for the economy, with due attention paid to credits for property and for production and business activities in order to support the market and unleash investment capital flows for the economy.”

The SBV will in August propose a credit package worth VND10 trillion ($416.6 million) for businesses specialised in processing fishery and aquatic products, and other types of credit packages. Also this month, the government will enact a decision on reducing 30 per cent of land rental for 2023.

“We will also revise and remove business conditions currently stipulated in specialised laws if such conditions are found illegal, unnecessary, infeasible, and unclear. Moreover, the government will also review and revise all kinds of practising certificates in order to reduce their number and save costs for the society,” PM Chinh stated at last week’s government meeting on the national socioeconomic situation.

The government will also unify, merge, and simplify legal documents in a manner that it will be easy to understand and access, fully ensuring transparency.

“All costs for enterprises must be reduced and saved, with businesses’ ability to access to capital and the market to be increased. All efforts are to be made to quickly recover production and business activities and achieve the highest results in economic growth,” PM Chinh stated.

The government has directed the General Department of Vietnam Customs to coordinate with authorities at all levels in simplifying the current administrative processes or consider applying priority import and export processes to help businesses optimise time and costs, and speed up the import process and procedures for essential commodities and accelerate the export of agricultural products and key export commodity groups.

National Assembly deputy Pham Trong Nghia, representing the northern province of Lang Son, said “In order to formulate exact solutions for enterprises, it is necessary to thoroughly review and study all challenges at home and abroad, with consultancy from all stakeholders.”

In late June, the government enacted Decree No.44/2023/ND-CP on VAT reduction until the end of the year, from 10 to 8 per cent for all types of goods and services.

Specifically, the VAT reduction policy will help businesses reduce 20 per cent of the percentage for tax calculation when issuing value-added invoices, for goods and services currently subject to the 10 per cent tax rate.

What is more, the government has also applied a reduction of the collection rate of 35 fees and charges from July 1 to December 31, equivalent to a decrease in revenue of VND700 billion ($29.1 million) in the state budget in order to support businesses and individuals.

In April, the government promulgated Decree No.12/2023/ND-CP on extending the deadline for paying VAT, corporate income tax (CIT), and personal income tax.

The decree stipulates a six-month extension for VAT amounts from March-May 2023 and Q1; five months’ extension for June and Q2; four months’ extension for July 2023; and a three-month extension for August.

When it comes to CIT, the decree stipulated that payment of this type of tax would be extended for the temporarily paid sum for Q1 and Q2 of the tax calculation period in 2023. Specifically, the time for payment extension will be three months as from the date of ending the payment time under the tax management law.

It is estimated that the value of the CIT payment extension will be around $1.86-1.9 billion.