Nghe An Tax Department: Striving to complete the 2016 budget revenue target.

(Baonghean)2016 was the first year of implementing the Resolution of the 12th National Party Congress, the Resolution of the 18th Nghe An Provincial Party Congress, and the 5-year socio-economic development plan for 2016-2020. Therefore, completing the task of collecting state budget revenue was of paramount importance, serving as a prerequisite and driving force for achieving the revenue collection targets in subsequent years.

Export production at Haivina Kim Lien Garment Company (Nam Dan). Photo: Chau Lan

Overcoming difficulties

In 2016, the Tax Department embarked on its political mission amidst numerous difficulties: high revenue targets, limited new businesses, natural disasters, and harsh weather conditions. Furthermore, marine environmental pollution incidents severely impacted the production and business activities of many enterprises, especially in the trade, service, restaurant, hotel, food, and transportation sectors.

The government's ban on the export of raw white stone has also caused production stagnation for mining and mineral processing businesses. Several new policies (effective from January 1, 2016) have reduced revenue sources, such as: the general corporate income tax rate was reduced from 22% to 20%, and businesses already enjoying a preferential corporate income tax rate of 20% had it reduced to 17%. Harsh weather conditions, including prolonged heatwaves and widespread droughts, have reduced commercial electricity production, resulting in lower tax payments for hydropower companies.

Revenue from some key businesses is lower than the same period last year, thus affecting the province's state budget revenue. In addition, many businesses have large tax debts and are no longer actively engaged in production or business operations. Businesses in Nghe An province are mainly small, medium, and micro-sized enterprises; some large projects are in the investment phase, meaning they have not yet paid taxes or are currently receiving value-added tax refunds.

Meanwhile, the 2016 state budget revenue forecast set by the Ministry of Finance, the Provincial People's Council, and the Provincial People's Committee is very high, increasing by 31% compared to the 2015 forecast and by 1,400 billion VND compared to the actual revenue in 2015. Implementing the plan for the year will truly not be easy.

Nevertheless, under the guidance and direction of the Party committees at all levels, local authorities, the Ministry of Finance, the General Department of Taxation, and the close coordination of functional agencies; the spirit of overcoming difficulties in production and business of the business community; and the efforts of nearly 1,200 officials and employees of the Nghe An Tax Department, certain results have been achieved in the first eight months of 2016.

Comrade Nguyen Dinh Hoa, Director of the Tax Department, chaired the online meeting with the Sub-departments.

As of August 31, 2016, the total domestic revenue collected in the province reached VND 6,022 billion, equivalent to 74% of the central government's budget estimate, 67% of the provincial People's Council's budget estimate, and 117% compared to the same period last year.

Several revenue streams showed high growth compared to the same period last year: Environmental protection tax revenue reached VND 479 billion in the first eight months, equivalent to 84% of the projected target and a 218% increase compared to the same period last year; land use fee revenue reached VND 1,019 billion in the first eight months, equivalent to 157% of the central government's projected target, 68% of the People's Council's projected target, and a 182% increase compared to the same period last year; revenue from foreign-invested enterprises reached VND 213 billion in the first eight months, equivalent to 68% of the projected target and a 127% increase compared to the same period last year.

The tax collection progress of the tax branches is generally quite good compared to the projected targets and higher than the same period last year. 14 out of 21 tax branches have met their projected revenue targets and exceeded those of the same period in 2015.

However, some revenue streams that account for a large proportion of total revenue have not met their targets, such as revenue from central state-owned enterprises (reaching only 59% of the projected amount in the first eight months), revenue from local state-owned enterprises (reaching 66% of the projected amount), and revenue from non-state-owned industrial, commercial, and service sectors (reaching 65% of the projected amount).

The main reasons are: Hydropower businesses suffered a revenue shortfall of over 30 billion VND due to prolonged drought and heatwaves reducing commercial electricity production; beer businesses experienced a revenue shortfall of nearly 60 billion VND due to reduced production (a decrease of 9 million liters); and other key businesses suffered a revenue shortfall of nearly 70 billion VND... Notably, revenue from non-managed tax sectors (other budget revenues and fixed revenues at the commune level) only reached 45% and 58% of the projected targets in the first eight months, respectively, requiring stronger and more coordinated efforts to increase this revenue source.

The Tax Department is fighting against tax evasion in the petroleum business.

Final phase solutions

The task of collecting state budget revenue in the remaining months of 2016 is extremely challenging. In the coming period, the Tax Department will focus on overcoming difficulties, proactively implementing various solutions decisively, and resolutely ensuring that state budget revenue collection meets and exceeds the projected targets, laying the groundwork for completing the tasks of 2016 and subsequent years. Specifically, the Department has set out 6 key tasks and 16 solutions for the remaining months of the year.

Mineral water production at Nghe An Water Supply Company Limited. Photo: Chau Lan

Specifically, the focus will be on vigorously striving to complete the task of collecting budget revenue in the locality according to Government Resolution No. 01/NQ-CP and Directive No. 22/CT-TTg dated June 3, 2016, on strengthening the direction and management of financial and budgetary tasks in 2016; implementing comprehensive tax management measures, including strengthening inspection and auditing to combat tax evasion and smuggling, and promoting the management of outstanding tax debts; striving to complete the emulation targets and exceed the revenue forecast for 2016.

Continue to seriously implement the newly amended and supplemented tax policies; implement action programs and resolutions of the Government on promoting administrative procedure reform, strengthening support in resolving difficulties, obstacles, and recommendations of businesses as directed by the Government, the Ministry of Finance, and the General Department of Taxation. Implement tasks serving the preparation of the 2017 domestic revenue budget - the first year of the budget stabilization period - in accordance with the Prime Minister's directive in Directive No. 21/CT-TTg and the guiding documents of the Ministry of Finance and the General Department of Taxation.

Nguyen Dinh Hoa

(Nghe An Tax Department)