Minister of finance grilled during NA meeting

Minister of finance Hồ Đức Phớc answers questions from deputies during a National Assembly meeting in Hà Nội. VNA/VNS Photo Doãn Tấn

HÀ NỘI — Minister of Finance Hồ Đức Phớc told National Assembly (NA) deputies on Wednesday his ministry has been working around the clock to come up with solutions to bring down petrol prices.

Phớc said right now petrol prices in Việt Nam were higher than in neighbouring countries such as Cambodia, Laos and Thailand despite a recent environmental tax cut approved by the NA. 

He said while further tax cuts are possible the NA must consider the possibility that smuggling activities across the borders increase. He said in the long run Việt Nam must find ways to increase domestic production. 

Reining in petrol prices was also a top priority in the country’s effort to control inflation this year, along with the introduction of flexible and resilient monetary policies. 

In light of recent stock market scandals, he said his ministry has taken notice of unusual activities, including the derivatives market, in which the value of certain stocks was inflated without improvement in business performances. In many cases, publicly listed companies failed to properly publish the information required by the laws. 

The finance minister vouched to ramp up efforts to oversee stock brokers and credit ratings as well as intermediaries. Meanwhile, the ministry advised the Government to conduct reviews and studies of current laws and regulations and to increase penalties for rule-breakers. 

Speaking on the sluggish process of equitisation of State-owned Enterprises (SOEs), Phớc said the Government has managed to recover more than VNĐ200 trillion (US$8.62 billion) between 2016-21. However, there has not been much progress made since 2018, which contributed to difficulties in asset auditing and land-use rights for SoEs. 

Another major issue was the lack of comprehensive legal guidance to help the management of SOEs navigate the process, which has resulted in unwillingness and resistance from executives.

Moving forward, Phớc said the Government’s position is to recover State capital from all SOEs in which the Government does not have a controlling share and to strengthen State’s control in SOEs that are considered strategic and vital to the economy and national interests. 

During the meeting, NA deputies asked the finance minister what measures have been taken to prevent tax evasion in the property market and reduce petty bribery and rampant corruption by low-level public servants. 

Phớc said buyers and sellers have been found to exploit a loophole in current regulations that use agreed-upon prices stated in purchase and sale agreements to calculate the amount of taxes owed. It has resulted in people putting much lower prices on the written agreements to avoid paying more in taxes. 

In order to close the loophole, the ministry has been in talks with local authorities and tax offices to step up inspection of property sales. Buyers and sellers who failed to declare purchase prices or declare unrealistic prices would have to follow set prices by local government offices, which will be readjusted every five years. 

Phớc said there have been positive signs since the implementation of tax evasion preventative measures. According to the Ministry of Finance, the State Treasure has collected over VNĐ16.2 trillion in property sales tax during the first four months of 2022, a VNĐ6.6 trillion increase from the same period last year. 

To limit corruption and petty bribes, the ministry has instructed the General Department of Taxation to heavily penalise public servants found to have demanded bribes from citizens. 

Asked if Việt Nam has managed to collect taxes from digital commercial platforms, Phớc said major tech companies including YouTube, Google, and Microsoft have registered and fulfilled their duties for commercial activities within the country. 

The ministry has also demanded digital commerce commercial platforms meet financial duties on behalf of their users. This, however, has proven to be challenging as many users of said platforms are not operating from Việt Nam. VNS