The Ministry of Finance's main office in downtown Hanoi. (Photo: VNA)

Hanoi - The Ministry of Finance (MoF) said tax support policies and land-use fee reductions for businesses should be continued throughout 2023 despite shortfalls in state budget collection.

However, the ministry's proposal did not include a value-added tax (VAT) reduction of 2 per cent, which it said has been challenging and complicated to implement.

In the MoF's latest proposal to the government, businesses, household businesses and individuals were to continue to enjoy a 30 per cent cut in land-use fees in 2023, on top of an extension on their tax duties.

"The ministry supports the government's policy to give businesses more time to meet their financial duties and a 30 per cent reduction in land-use fees as parts of an effort to support businesses," Minister of Finance Ho Duc Phoc said.

Phoc said key priorities for the government this year include speeding up the disbursement of public investment projects, injecting cash into the economy and helping improve businesses' performance.

"Improved performance will help reduce the unemployment rate, boost budget collection and solves various socio-economic related issues," he added.

A series of measures, including VAT slashed from 10 per cent to 8 per cent and reduction of land-use fees, worth a total of 223 trillion VND last year, have received positive feedback from the business community and boosted economic recovery after the pandemic.

In addition, the government, in an attempt to rein in inflation and boost economic recovery, has cut the environmental tax on fuel from 20 per cent to 10 per cent, a large number of administrative fees and rolled out numerous e-government projects.

In an interview with the Vietnam News Agency (VNA), the minister said the finance ministry has been working around the clock to bring stabilisation back to the stock market with key focuses on solving issues related to corporate bonds and improving transparency and legal frameworks.

Economists, however, have voiced concerns about the country's economic prospects in 2023, saying the country will likely experience a short period of low growth, inflation and increased risks to its financial system.