VN expects to collect more taxes next year

Thien Thanh Sanitaryware joint company

VN expects to collect more taxes next year

The General Department of Taxation anticipates an 11.7 per cent increase in tax collection next year, based on macroeconomic forecasts for 2016. With the gross domestic product estimated at 6.7 per cent and the consumer price index below 5 per cent, tax collection was expected to reach VND805 trillion (US$35.78 billion) in 2016, a rise of 11.7 per cent over 2015's anticipated figure.

The tax collection for crude oil was estimated at VND50 trillion ($2.22 billion), equivalent to 80 per cent of this year's anticipated result, based on an expected 1.72-million-tonne drop in crude oil output to 14.02 million tonnes and a price of $60 per barrel.

The general tax department estimated that the domestic collection (excluding crude oil) would rise by 9.9 per cent to VND755 trillion ($33.55 billion).

If collection from land use is also excluded, an estimated VND650 trillion ($28.8 billion) in taxes will be collected, accounting for more than 80 per cent of the estimated total collection.

Figures from the Ministry of Finance showed that the country's tax collection was derived primarily from value added tax, corporate income tax and import and export taxes, as well as special consumption tax on imported goods.

With Viet Nam integrating deeply into the global economy following the signing of free trade agreements with many reduced or eliminated tariffs, collections that support the country's budget will be heavily affected.

Deputy Minister of Finance Vu Thi Mai said at the ministry's recent quarterly meeting that the percentage of collections from imports and exports would decrease, given the country's commitment to liberalising trade.

In order to ensure collections meet the needs of the budget, domestic collection must rise, she said.