Tax reduction is one of measures to help enterprises boost production and trade

(VOVworld) - At the Government’s monthly meeting for April, the Prime Minister focused on removing obstacles hampering production and trade. The Government will soon issue a resolution on measures to help the business community. VOV reporter Thu Hoa examines the issue.

Minister of Planning and Investment Bui Quang Vinh said that production and trade in some sectors like seafood, agriculture, consumer goods, and export items have significantly improved this year, thanks to synchronous measures to help enterprises overcome difficulties. But challenges remain such as relatively high interest rates, restricted loan access, large inventory, and large numbers of business failures. The Prime Minister asked ministries and agencies to make a greater effort to remove hurdles for enterprises, expand markets, and work out more appropriate tax policies for labor-intensive SMEs. Prime Minister Nguyen Tan Dung said ‘The Government agreed to continue its drastic measures to attain set targets. The problem is how to organize, manage and implement the measures. Regarding Government agencies, we should drastically increase cooperation’.

Mr. Dung instructed the State Bank of Vietnam to continue to lower interest rates, making it easier for businesses to boost output. State management agencies were asked to communicate closely with enterprises to keep track of their reactions. The Government will soon issue a new resolution on supportive packages to help businesses. Vu Duc Dam, Minister and Head of the Government Office told a press conference late last week ‘The Government will consider an extension of corporate income taxes, and value-added taxes until late this year or early next year. The supportive tax reduction package will help ease a 192-million-USD burden on enterprises’.

Along with business restructuring, the Government will also help enterprises clear off stockpiled items through programs to encourage consumption, bring goods to rural areas, quickly disburse capital for infrastructure development, and build subsidized housing. The Government will also increase state budget allocations for trade promotion, expansion of export markets, and human resource training for industrial production and SMEs. Economist Vu Dinh Anh comments ‘One of the reasons domestic products aren’t consumed more is the price. I propose reducing prices. Price reduction means dropping indirect taxes to stimulate aggregate demand. The reduction or elimination of indirect taxes will be effective more quickly’.

At the government meeting for April, the Ministry of Planning and Investment proposed 5 measures to help enterprises overcome difficulties. They include macro-economic stabilization, continuing to curb inflation by reducing interest rates, improving market economy institutions, and speeding up the national economic restructuring.