Planning ministry suggests tax delay for 2010 first quarter
The plan, submitted to the Government is aimed at further stimulating the national economy.
MPI believes it is not necessary to continue exempting taxes, including CIT, valued added tax (VAT), personal income tax (PIT) and other types of fee in 2010. However, the ministry says that in order to help businesses ease the tax burden on them, it would be better to allow businesses to delay the CIT payment for three months.
MPI has also suggests the Government continues providing interest rate subsidies to enterprises, farmers and poor households. However, the interest rate level should be lower than the currently applied four percent. It has emphasised that administrative procedures for lending should be more simple with fewer documents required.
Regarding the continued preferential loans for businesses, MPI thinks that the scheme now should focus on medium and long term loans which help businesses expand production or make investment in technology, rather than short term loans for working capital.
Extending the short term loan interest rate subsidy programme is still the hot topics among economists. The National Assembly’s Economics Committee, in its report released October 1, said that the programme should be terminated as scheduled on December 31, after it has successfully completed the mission of rescuing businesses in the most difficult time.
In its latest report, the State Bank of Vietnam (SBV) said that the credit growth rate has reached 28 percent by the end of the third quarter of the year in comparison with the end of 2008. Meanwhile, the ceiling credit growth rate for 2009 has been set at 30 percent in order to prevent high inflation.
Prior to that, the Ministry of Industry and Trade (MOIT) has consulted with relevant ministries on the plan to curb the trade deficit for the last months of the year. Two of the measures the ministry suggested are raising import tariffs on passenger vehicles with less than 15 seats and adding mobile phones into the list of products subject to luxury tax.
Regarding the tariff adjustment on car imports, the ministry believes that this will help control the trade deficit at 20 percent of total import revenue.
The ministry has also suggested to remove the policies aiming to stimulating car demand, i.e. removing the policies on 50 percent VAT reduction and 50 percent ownership registration tax reduction.
