NA wants efficient airport project

 Under the Government’s proposal, Long Thanh Airport would be built in the southern province of Dong Nai with a total investment of nearly US$8 billion for the first phrase.

Funding for the project will come from the State budget, Government bonds, Official Development Assistance and private sources.

During group discussions yesterday, the deputies agreed that it was essential to build the airport to ease pressure on Tan Son Nhat Airport in HCM City.

However, they said many questions remained for the feasibility of the project.

Deputy Dao Van Binh from Ha Noi and Hoang Thanh Tung from the Mekong Delta province of Soc Trang raised concerns about the cost of the airport, saying that it was necessary to build the airport but not now when the country’s public debt was high.

Deputy Do Kim Tuyen from Ha Noi said there was a need to have a clear transport development vision in line with the country’s real conditions before deciding to build the airport.

He said the Government should make more clear how the new airport would link up with Tan Son Nhat airport and become a key entry point to the region.

Deputy Pham Quang Nghi, who is secretary of the Ha Noi People’s Committee, said the airport was needed to help development but that more consideration should be made about the project’s investment capital.

Many deputies are undecided about building the airport because of pressure on public debt, he said.

He also noted that some objectives were not feasible, such as the need for the new airport to become a regional aviation hub.

He said it was necessary to draw lessons from previous important large-scale projects. Many projects that were carefully discussed failed to work as efficiently as expected, including the Dung Quat oil refinery and bauxite projects in the Central Highlands.

Some deputies also raised concerns about the social impacts of the project on the living conditions of local residents relocated for the project.

This includes creating job for more than 9,000 people of working age. An estimated 5,000ha of land will be revoked for the construction of the airport.

Under the project, the new airport will be built in three phases. Total investment for the first phase is estimated at VND164.589 trillion (US$7.84 billion).

The Government plans to source VND84.624 trillion ($4 billion) from the State budget, Government bonds and Official Development Assistance (ODA) and the remaining from non-State sectors.

The first phase is expected to be completed in 2025 and the second in 2030.

Supporting industry

Earlier yesterday, the NA deputies expressed broad support for preferential policies and regulations for the support industry, saying it was a welcome step in the right direction.

They also agreed that revisions and supplements were needed for several laws on taxes including the Law on Special Consumption Tax and those related to tax management.

Huynh Minh Thien of HCM City expressed agreement with the Government’s report on supplemental preferential regulations for the supporting industry, saying it would create a legal framework for local firms to do more than outsourcing work.

The Government should issue the category of products that will receive support early next year, he said.

Bui Van Cuong from the Central Highlands province of Gia Lai said that developing the nation’s supporting industry was an important solution that would help domestic manufacturers source materials, parts and components more efficiently.

They would be able to select providers, reduce production costs, enhance competitiveness and avoid excessive dependence on foreign supply sources, he said.

He suggested that the Government thoroughly reviews the category of products and areas in need of support towards ensuring transparency and effectiveness.

Tran Hoang Ngan of HCM City also said that supplementary preferential regulations for the domestic firms in the supporting industry were needed because most of firms at present were foreign-invested ones.

Another deputy from HCM City, Pham Khanh Phong Lan, proposed preferential taxation for enterprises that invest in scientific research.

"As of now, a lot of research projects rely on the State Budget and this has led to a situation where many of these are not practical," she said.

The deputies also asked the Government to carefully consider canceling fines for slow tax payment. They said this would set a bad precedent, tie the hands of law enforcement agencies and affect the principle of equality.

Milk and cigarettes

Many NA deputies urged higher taxes on tobacco, wine and beer, saying the current duties imposed were too low.

Doan Nguyen Thuy Trang of HCM City pointed out that Viet Nam’s tax on tobacco was much lower than other countries. The price of a pack of cigarettes in Viet Nam was equal to just one litre of milk, while in other countries, it was as much as four litres.

She proposed that from 2015, the tax on tobacco is increased from 65 to 85 per cent, to 70 per cent for liquor that is 20 per cent proof (ABV) and above, to 40 per cent for liquor under 20 ABV and to 65 per cent for beer.

She also proposed a reasonable increase in tax on alcohol-free soft drinks to give a warning to consumers of the health hazards involved.

Agreed with Trang, Huynh Thanh Lap from HCM City said that the number of patients with the main five non-communicable diseases of cancer, heart-disease, blood pressure, diabetes and obesity in Viet Nam has increased significantly due to lifestyle changes and use of products like liquor, tobacco and soft drinks.

In 1985, the total number of patients suffering from these diseases accounted for 39 per cent of hospitalised cases, but this increased to 63 per cent in 2011, he said.

These diseases accounted for 75 per cent of fatalities in hospitals and the cost of treating them is estimated at around VND23 trillion (nearly US$1.1 billion) a year.

A reasonable increase in taxes on these products could help correct lifestyles and protect the health of citizens, he said.

Meanwhile, Nguyen Quoc Binh of Ha Noi struck a note of caution, saying that the issue of smuggling should be taken into consideration when increasing taxes on these products.

"The higher the taxes, the greater the smuggling, and this could cause difficulties for domestic production," he said.

"The tax increase roadmap should sychronise with anti-smuggling efforts," he said.