After the commencement of the EU-Vietnam Free Trade Agreement (EVFTA) and the UK – Vietnam Trade Agreement (UKVFTA), Vietnam is considered as a key country to source goods from Asia and attract Europe investors' attention in the coming years. In addition, the effective containment of Covid-19 in Vietnam would also contribute to the growth of Vietnamese exports in the years to come.
Last week, at the year-end conference of Vietnam’s tax authorities on January 5, Director of the General Department of Taxation Cao Anh Tuan revealed the figure, despite the severe Covid-19 crisis, Vietnam’s tax revenue in 2020 reached VND1,278 trillion (US$55.37 billion), 2% higher than the yearly estimate or an increase of VND24.34 trillion (US$1.05 billion).
The past week spotlight
Vietnam tax revenue in 2020 exceeds year’s target despite Covid-19
“The result showed the strong efforts from the government in pursuing the dual target of both containing the pandemic and boosting economic recovery,” stated Mr. Tuan.
Deputy Prime Minister Truong Hoa Binh at the conference. Photo: Le Son.
So far, 55 out of 63 provinces/cities have realized or even exceeded their respective tax revenue targets this year, in which Hanoi remained a highlight with tax revenue of VND265.89 trillion (US$11.52 billion), up 5.9% year-on-year.
In 2021, the National Assembly set tax revenue target of VND1,116 trillion (US$48.36 billion), which Mr. Tuan said is a challenging task given the complicated Covid-19 situation globally and the dim outlook for the world’s economy.
Let’s look at some other related financial and business news during the past week:
1. Vietnam sees 2,100 new enterprises in first week of 2021
An estimated 2,100 enterprises were established in the first week of 2021, after the 2020 Law on Enterprises began to take effect, up 46% from the same period last year, according to the Ministry of Planning and Investment (MPI).
2. Enterprises must be at heart of reform, development: PM
Prime Minister Nguyen Xuan Phuc has asked the industry and trade sector to view enterprises as the centre of reform and development so as to further facilitate production and business activities and enhance competitiveness.
PM Phuc made the request at a conference in Hanoi on January 7 that reviewed the industry and trade sector’s performance in 2020 and launched tasks for this year.
3. Vietnamese, US officials talk economic, trade issues
Minister of Industry and Trade Tran Tuan Anh, who is also Chairman of the Vietnam - US Trade and Investment Framework Agreement (TIFA) Council, has held phone talks with US Trade Representative (USTR) Robert Lighthizer to discuss bilateral economic and trade issues.
4. Vietnam Gov’t announces measures to boost economic growth in 2021
Government agencies continue to tighten procedures of issuing new legal documents related to business conditions, administrative procedures and specialized inspection to create a favorable and transparent business environment.
The Vietnamese Government has announced resolution No.01/NQ-CP in the first working day of 2021, targeting a strong economic rebound after a Covid-19 ravaged year.
5. Covid-19 costs Vietnam US$19 billion in export revenue
Vietnam could have earned US$300 billion from exports this year but the export revenue stood at just US$281 billion due to Covid-19, said Minister of Industry and Trade Tran Tuan Anh.
Minister Anh said the export revenue was lower than the target although the country had adjusted itself in line with the developments of the pandemic and worked out response plans, Thanh Nien Online newspaper reported.
6. Property prices expected to rise 10 percent in 2021
Real estate prices in 2021 are expected to increase by 10 percent over the previous year, said Nguyen Van Dinh, deputy general secretary of the Vietnam Real Estate Association (VNREA).
Dinh told a forum held on January 6 that the COVID-19 pandemic affected the real estate sector, causing weakening demand in the market. In early 2020, the market was frozen. The Government has taken many measures to untie the sector’s difficulties such as the promulgation of legal regulations for condotel development. However, legal obstacles have hindered supply, creating double difficulties for the market.
On 18 June 2021, the Ministry of Finance issued Circular 45/2021/TT-BTC (“Circular 45”) providing guidance on the implementation of Article 41 of Decree 126/2020/ND-CP (“Decree 126”) dated 19 October 2020 of the Government on the application of the Advance Pricing Agreement (“APA”) on tax administration for companies having transactions with their related parties.