Resolution No. 49/2017/QH14 dated November 13, 2017 of the National Assembly on the 2018 state budget estimates

RESOLUTION

On the 2018 state budget estimates[1]

THE NATIONAL ASSEMBLY

Pursuant to the Constitution of the Socialist Republic of Vietnam;

Pursuant to the National Assembly’s Law No. 83/2015/QH13 on the State Budget and Resolution No. 25/2016/QH14 of November 9, 2016, on the national 2016-2020 five-year financial plan;

On the basis of considering the Government’s Report No. 464/BC-CP of October 18, 2017; the Committee on Financial and Budgetary Affairs’ Verification Report No. 739/BC-UBTCNS14 of October 20, 2017; the National Assembly Standing Committee’s Explanatory Report No. 211/BC-UBTVQH14 of November 10, 2017; and opinions of National Assembly deputies,

RESOLVES:

Article 1.To approve the 2018 state budget estimates

1. The total state budget revenue isVND 1,319,200 billion(one million, three hundred and nineteen thousand, and two hundred billion Vietnam dong).

2. The total state budget expenditure isVND 1,523,200 billion(one million, five hundred and twenty-three thousand, and two hundred billion Vietnam dong).

3. The state budget deficit isVND 204 trillion(two hundred and four trillion Vietnam dong), equivalent to3.7%of gross domestic product (GDP), of which:

The central budget deficit isVND 195 trillion(one hundred and ninety-five trillion Vietnam dong), equivalent to3.54%of GDP;

The local budget deficit isVND 9 trillion(nine trillion Vietnam dong), equivalent to0.16%of GDP.

4. The total state budget borrowings, including borrowings to offset budget deficits and borrowings for payment of principal debts of the state budget, areVND 363,284 billion(three hundred and sixty-three thousand, two hundred and eighty-four billion Vietnam dong).

(See Appendices 1, 2, 3 and 4)

Article 2.Toadjust the 2017 state budget estimates

1. To reduce government bond estimates by VND 14,033.795 billion and, at the same time, increase the foreign capital estimates by VND 14,033.795 billion to allocate the fund estimates to projects for which the funds have been disbursed but the estimates were not made in 2016 or earlier. To add such projects to the list of projects in the medium-term public investment plan during 2016-2020 which may use funds from medium-term foreign capital’s provisions(See Appendix 5).

2. To add VND 245.814 billion in development investment expenditure estimates from the 2017 non-refundable aid to the Electricity of Vietnam and 8 localities under the Government’s Report No. 349/TTr-CP of August 23, 2017(See Appendix 6).

3. To add VND 77.66 billion in non-business expenditure estimates for environmental protection from the Asian Development Bank’s loans to Thua Thien Hue province under the Government’s Report No. 403/TTr-CP of October 4, 2017.

Article 3.To assign the Government to take measures to administer the 2018 financial-budgetary tasks

1. To implement a prudent fiscal policy in close combination with the monetary policy to support the development of production and business, further stabilize the macro economy, curb inflation, and boost economic growth. To intensify the financial-budgetary discipline and implement state budget estimates in accordance with law. To increasingly inspect and examine and maintain publicity and transparency in the use of state budget allocations.

2. To direct the proper implementation of laws on taxes, charges and fees; to study amending and supplementing a number of tax policies and laws through restructuring revenue sources, ensuring tax neutrality, strengthening the primary role of the central budget and tax collection management. To boost the reform of tax-related administrative procedures; to facilitate production and business activities and support the development of enterprises. To make substantial changes in prevention of revenue loss, smuggling, trade fraud, production and trading of counterfeit goods, transfer pricing, and tax evasion. To strive to reduce the rate of outstanding tax debts to below 5% of the total state budget revenue.

3. During 2018-2020, to continue transferring 100% of revenues from value-added tax and excise tax on petrol and oil products of Nghi Son Refinery and Petrochemical Limited Liability Company to the central budget; to maintain the percentage (%) of distributing the revenues from environmental protection tax for domestic and imported petrol and oil products like in 2017.

4. To remit into the state budget 72% of the profits from oil and gas shared to the host country, profits shared from the Vietnam-Russia joint venture (Vietsovpetro), and earnings from document proofreading in 2018; and reinvest the remainder (28%) in Vietnam Oil and Gas Group in accordance with law.

5. To further use the revenues from construction lottery activities for development investment, giving priority to investment in the fields of education, training and vocational training, public healthcare and new-style countryside building program; after allocating capital to ensure completion of investment projects in the above fields, to allocate the remainder for climate change response projects and other important projects to be covered by local budgets.

6. To administer state budget expenditures according to assigned estimates. To thoroughly practice thrift in current expenditures of each ministry, central agency and locality; to minimize expenses for organization of conferences, seminars, festivals, and overseas study or survey trips; to allocate funds for equipment procurement in accordance with law; to increase payment of fixed expenses for use of public cars. To further the administrative reform and increase the application of information technology in tandem with strengthening supervision in the management of state budget revenues and expenditures. To promulgate policies that increase state budget expenditures only when it is really necessary and there are funding sources to cover the expenditures. To strictly implement the Law on Thrift Practice and Waste Combat, Anti-Corruption Law and Law on Management and Use of Public Property.

7. From July 1, 2018, to adjust basic salary from VND 1.3 million/month to VND 1.39 million/month, and adjust pension, social insurance allowances and monthly allowances (for persons enjoying salaries from the state budget) in accordance with law and preferential allowances for people with meritorious services in an amount equal to the increase in the basic salary.

To assign ministries, central agencies and localities, based on their assigned state budget estimates, to further implement policies on seeking financial sources for salary reform by minimizing expenditures in combination with reorganizing organizational apparatuses and downsizing payroll, to ensure the self-balancing of expenditures increased as a result of basic salary adjustment.

The central budget must allocate funds for adjustment of pension, social insurance allowances and monthly allowances (for persons enjoying salaries from the state budget) in accordance with law and preferential allowances for people with meritorious services; and provide partial allocations for localities that cannot balance their funding sources for payment of increased salaries in accordance with the Government’s regulations.

After having enough funds for salary reform, localities shall take the initiative in using their financial sources for salary reform to implement social security regimes and policies promulgated by central agencies. The central budget must provide target transfers for local budgets for the deficient funds in accordance with law.

During 2018-2020, localities that have budget revenues transferred to the central budget and can balance funding sources for salary reform and implementation of social security policies for the whole roadmap without requesting support from the central budget may use the remaining funds for salary payment to invest in projects in accordance with law.

8. To direct ministries, central agencies and localities to:

a/ Strictly implement the policy on payroll downsizing, and organize their administrative apparatuses to be streamlined and effective.

b/ Boost the renewal of management and financial mechanisms and reorganize their public non-business units; on that basis, restructure their budgets in each field, reduce budget allocations for public non-business units, reserve funds to increase financial supports for policy beneficiaries in the use of public non-business services, create funding sources for salary reform and increase expenditures for investment and procurement to raise the quality of public non-business services. To renew the mechanism of providing financial supports for public non-business units based on their operation efficiency.

c/ Adjust prices of commodities subject to price management by the State to match market prices, ensuring the reasonable offsetting of  production and business costs and investment attraction from other economic sectors.

9. The total value of government bonds to be issued in 2018 must not exceed VND 50 trillion, including the value of government bonds to be transferred to 2018 (if any) for investment in projects that fully satisfy investment procedures as prescribed.

10. To strictly implement the medium-term public investment plan during 2016-2020 under the National Assembly’s Resolution No. 26/2016/QH14. To manage state budget expenditures for development investment in accordance with law. To mobilize more domestic and foreign resources for development investment, complete legal grounds to boost public-private partnership, and create conditions for economic sectors to invest in building infrastructure, particularly in agriculture, rural areas and tourism. To strictly manage advance payment based on state budget estimates and carrying-forward of expenditures in accordance with the Law on the State Budget. To review and deal with problems and shortcomings in the legal system on public investment, and promptly allocate capital and speed up disbursement.

11. To strictly implement the National Assembly’s Resolution No. 25/2016/QH14 on the national 2016-2020 five-year financial plan. To strictly control state budget deficit, local budget deficit and local budgets’ debts, and take active measures to reduce budget deficit. To increasingly inspect and supervise the borrowing and use of loans and payment of debts, particularly new loans, foreign loans and government-guaranteed loans; not to use loans under new loan agreements for current expenditures in accordance with the Law on the State Budget (except the agreements signed and having funds disbursed in 2017 or earlier). To keep the country’s public debts, government debts and foreign debts within the prescribed limits.

12. To assess and summarize the application of special financial mechanisms in several fields and gradually reduce the application of special mechanisms for state management tasks. To strengthen the management of off-budget state financial funds, ensuring publicity and transparency; to expeditiously reorganize and renew the management mechanism applicable to such funds to make them operate in accordance with the law on the state budget.

Article 4.Supervision of implementation

The National Assembly Standing Committee, the Committee on Financial and Budgetary Affairs, the Ethnic Council and other committees of the National Assembly, delegations of National Assembly deputies, and National Assembly deputies shall, within their ambit of their responsibilities and powers prescribed by law, supervise the implementation of this Resolution.

This Resolution was adopted on November 13, 2017, by the XIV^thNational Assembly of the Socialist Republic of Vietnam at its 4^thsession.-

Chairwoman of the National Assembly
NGUYEN THI KIM NGAN

* The appendices to this Resolution are not translated.