Clarifying organizations and individuals violating budget revenue and expenditure

Continuing the 5th Session Program, on the morning of May 25, the 13th National Assembly considered the Proposal on the Draft Law amending and supplementing Article 170 of the Law on Enterprises.

Deputy Prime Minister Vu Van Ninh speaks. (Photo: Duong Giang/VNA)

According to the Government's Proposal presented by Minister of Planning and Investment Bui Quang Vinh, authorized by the Prime Minister, at the Hall, Clause 2, Article 170 of the 2005 Enterprise Law stipulates that foreign-invested enterprises that are currently organized and operating under the Law on Foreign Investment in Vietnam have the right to choose to re-register to organize and operate under the provisions of the Enterprise Law within 2 years from July 1, 2006 or not to re-register. In case of not re-registering, the enterprise is only allowed to conduct business within the scope of the business lines and the term stated in the Investment License.

According to statistics, as of July 1, 2011, the final deadline for re-registration, out of 6,000 foreign-invested enterprises, 2,916 have re-registered according to the provisions of Point a, Clause 2, Article 170; about 3,000 enterprises have not re-registered according to the provisions of Point b, Clause 2 of this Law. These enterprises have a total registered capital of 18.5 billion USD, employing 446,000 people. Up to now, there are some enterprises whose operating period as prescribed in the Investment License has expired but want to re-register to continue operating; some enterprises still have the operating period stated in the Investment License but want to add or expand their business lines.

The amendment to Article 170 of the Enterprise Law aims to remove difficulties and create conditions for foreign-invested enterprises to continue their operations, especially those that have entered stable production and business, have a long-term workforce, and contribute to society and the state budget. This amendment also aims to create a legal basis to encourage foreign-invested enterprises that have not yet re-registered to carry out new investment projects and expand their investment in Vietnam.

Accordingly, the Government proposes to amend Clause 2, Article 170 of the Enterprise Law in the following direction: Abolish the re-registration deadline for foreign-invested enterprises to allow enterprises to choose not to re-register or to re-register at an appropriate time for the enterprise. This amendment aims to ensure the autonomy of enterprises in deciding on the method of organization, management and business operations.

Examining the draft Law amending and supplementing Article 170 of the Law on Enterprises, the majority of members of the Economic Committee agreed with the amendments proposed by the Government. However, the examining agency also suggested that it is necessary to specifically review and only allow enterprises to re-register or expand their business lines if the investment activities do not violate the law (on environmental protection, tax obligations, etc.), and are consistent with the planning and policies to attract foreign investment of the Vietnamese State.

Also during this morning's working session, the National Assembly discussed in the hall the 2011 state budget settlement.

According to the Audit Report on the 2011 State budget settlement of the National Assembly's Finance and Budget Committee, the total State budget revenue in 2011 was VND962,982 billion (including revenue transferred from 2010 to 2011, revenue from local budget surplus in 2010, recovery of loan capital, and revenue from local budget investment mobilization according to the provisions of the State Budget Law). Of which, revenue according to the estimate assigned by the National Assembly in 2011 was VND721,804 billion, exceeding VND126,804 billion (21.3%). This is a positive result in the context of the country's economic difficulties, demonstrating the efforts of all levels, sectors, and the business community, including important contributions from the Tax and Customs sectors.

Also according to the report, the total state budget expenditure was 1,034,244 billion VND (including expenditure transferred from 2011 to 2012); the state budget deficit was 112,034 billion VND, equal to 4.4% of GDP (excluding local budget surplus).

However, the Audit Report also assessed: Although the State budget revenue has increased, it is not stable and has not originated from the internal strength of the economy. The budget estimate for VAT refunds in 2011 is not close to reality (the budget estimate for 2011 was 42,000 billion VND, the tax refund implementation was 61,000 billion VND, an increase of 19,000 billion VND).

Although import-export revenue increased by VND 17,065 billion, the outstanding value-added tax refunds amounted to VND 14,532 billion, creating additional pressure on budget imbalance in the following years. In the context of implementing a tight fiscal policy, both saving regular expenditures and cutting public investment, the total state budget balance expenditure still increased significantly (VND 61,954 billion), exceeding the estimate by 8.5%, mainly due to increased development investment expenditures (VND 56,306 billion).

The results of inspection, audit, and supervision show that there are many unfinished and behind-schedule projects, causing waste, the amount of outstanding construction investment debt is increasing, violations in basic construction investment occur at all stages from planning to project settlement, the efficiency of basic construction investment spending is limited, causing great loss and waste to the State budget. Spending on some important areas such as education, health, science and technology, economic career, national target programs has not been achieved, affecting the implementation of tasks and general socio-economic development goals.

Giving opinions on these contents, delegates suggested clarifying the effectiveness of State budget expenditures in 2011, especially for expenditures on investment and basic construction; at the same time, it is necessary to point out individuals and organizations that spend against principles, ineffectively, causing waste and loss of State budget.

Delegate Vo Thi Dung (Ho Chi Minh City) said that in the context of the country's many difficulties, the use of the State budget in 2011 still has waste and loss. Delegate Dung suggested that the National Assembly should clarify violations in the use of the State budget in order to have strict handling according to the provisions of the law.

Sharing this view, delegate Do Manh Hung (Thai Nguyen) said that the budget settlement report needs to go hand in hand with the report on the work of preventing and combating corruption and waste, especially in basic construction investment projects, spending and using the State budget to have a basis for handling violations.

Also this morning, the National Assembly discussed in the hall a number of contents with different opinions of the draft Law on Science and Technology (amended)./.

According to (TTXVN) - LT