Administrative reform to enhance national competitiveness

Hong Van
Chia sẻ
(VOVworld) – After a Government Resolution in March on key tasks and measures to improve the business environment, the Prime Minister issued Directive 24 on enhancing administrative management and reform in the tax and customs sector early this month. These moves show the government’s determination to create a fair, convenient trading environment to minimize investment cost and time for enterprises.
(VOVworld) – After a Government Resolution in March on key tasks and measures to improve the business environment, the Prime Minister issued Directive 24 on enhancing administrative management and reform in the tax and customs sector early this month. These moves show the government’s determination to create a fair, convenient trading environment to minimize investment cost and time for enterprises.

Administrative reform to enhance national competitiveness  - ảnh 1

World Bank’s Doing Business 2014 Report ranked Vietnam 149th out of 190 countries and territories in taxation, volume of tax documents, and time spent on tax procedures. Vietnam now ranks 65th in customs procedures. It normally takes 21 days for enterprises in Vietnam to complete customs clearance, compared to an average in ASEAN countries of just 11 days. Vietnam must reform its tax and customs procedures to reduce enterprises’ business risks and costs.

To meet international practice

In the first quarter the Government issued a resolution to reduce the time needed for customs clearance to 14 days and for tax procedures to 171 hours per year in 2015 in order to comply with international practices. Economists say the results will have profound impact on Vietnam’s business environment, especially minimizing trade and legal risks and reducing business costs. If Vietnam can reduce customs clearance time by 1 day, that will cut annual import and export costs 1%. In Directive 24, the Prime Minister urged a reduction in tax declaration and payment time to the average for ASEAN-6; that 95% of Vietnamese enterprises start using e-tax declarations by the end of this year; that all 63 provinces and cities start using e-taxation; and that the required time for administrative procedures be halved to 171 hours per year next year. Finance Minister Dinh Tien Dung said: “Between now and September the Finance Ministry will abandon a number of procedures to make things easier for businesses. We’ll identify unnecessary procedures and cut tax payment time and customs clearance to 201 hours. The difference between accounting profit and taxable income will be reduced to 35 hours. E-tax declaration and payment will be applied.”

Active implementation

Although Vietnam has already adopted several administrative reforms, tax payment time remains higher than elsewhere in the region. Finance Minister Dung said his Ministry will work with the Vietnam Chamber of Commerce and Industry, the Business Association, and the Association of Tax Consultation to review policies and work out specific action programs to save additional tax time. “The Finance Ministry has submitted a resolution to the Government to reduce difficulties for enterprises. We hope to eliminate 290 hours spent doing taxes of the 537 hours the World Bank reported for 2012. We’ll have three groups of measures to reduce the number of tax payments, streamline cumbersome requirements, and review policies.”

Through these measures, Vietnam intends to improve its business environment and competitiveness in ASEAN.

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