At a National Assembly meeting on business aid held yesterday, most lawmakers proposed to exempt personal income tax, and reduce corporate tax, to boost consumption and assist businesses.
Minister of Finance Vuong Dinh Hue said the entire package was valued at some VND29 trillion (US$1.39 billion), including both the solutions ordered by the government and tSTC by the NA.
Nguyen Ba Thuyen, a delegate from Lam Dong Province, spoke highly of the government’s assistance package, but also added that the government had not released it on time.
“Anyway, it’s better late than never,” he said.
“Should the aid be delayed further, it’ll be much more difficult for the economy to recover.”
Phung Quoc Hien, chair of the NA Finance and Budget Committee, said most of the members under his committee agreed on a 30 percent cut to corporate taxes.
Meanwhile, Mai Huu Tin, chair of U&I Investment JSC, called for more assistance besides that proposed by the government.
“We should cut valued-added tax, exempt personal income tax, and reduce the corporate tax from 25 percent to 20 percent,” he said.
“Cutting VAT tax by 50 percent will reduce state budget collection by VND15 trillion, while the loss will be some VND20 trillion in case of a corporate tax cut.
“But without these tax breaks, most of our small- and medium-sized enterprises will go bankrupt or dissolve, which will cause even greater damage to the economy, and especially increase the unemployment rate,” he elaborated.
Delegate Tran Du Lich, who represents HCM City, concurred, saying the 5 percentage point cut on the corporate tax should be released as soon as the beginning of next year.
Also at the meeting, many delegates demanded that taxpayers at the first level of the tax ladder – tSTC subject to a 5 percent tax rate – be exempted from personal income tax, while NA deputy chairwoman Nguyen Thi Kim Ngan said taxpayers at all levels should enjoy the exemption.
“The government will take the NA delegates’ proposals into consideration after the meeting today to complete the assistance package, and will continue to provide guidance to aid businesses,” said Ngan.
The NA is expected to approve a resolution on solutions to help businesses and individuals in 2012.