Resolution No. 43/2022/QH15 on fiscal and monetary policies to support the Program for Economic and Social Recovery and Development

CONSOLIDATED LEGAL DOCUMENT

OF THE NATIONAL ASSEMBLY

RESOLUTION

On fiscal and monetary policies to support the Economic Recovery and Development Program

and socio-economic development

OF THE NATIONAL ASSEMBLY

On the basis of the Constitution of the Socialist Republic of Vietnam;

BASED ON THE LAW ON THE ORGANIZATION OF THE NATIONAL ASSEMBLY NO. 57/2014/QH13, AS AMENDED BY SOME ARTICLES IN LAW NO. 65/2020/QH14;

Based on the consideration of Report No. 02/TTr-CP dated January 2, 2022 of the Government, the Audit Report No. 604/BC-UBKT15 dated January 3, 2022 of the Economic Committee, the Report No. 106/BC-UBTVQH15 dated January 11, 2022 of the Standing Committee of the National Assembly on the adoption, revision, and explanation of the draft Resolution on fiscal and monetary policies to support the Economic Recovery and Development Program, related documents, and the opinions of the National Assembly deputies; regarding the draft Resolution on fiscal and monetary policies to support the Economic and Social Recovery and Development Program, related documents, and the opinions of the National Assembly deputies;

RESOLUTION:

Article 1. Views

1. Closely adhere to the Party's guidelines and orientations, the resolutions of the National Assembly, persistently maintain macroeconomic stability, enhance productivity, quality, competitiveness, self-reliance, resilience, and adaptability of the economy, promptly meet both immediate and long-term needs, closely align with the Socio-Economic Development Plan for 2021-2025, the annual Socio-Economic Development Plan, the Economic Restructuring Plan for the period 2021-2025, the National Financial Plan and public borrowing and repayment plan for the period 2021-2025, the Medium-Term Public Investment Plan for the period 2021-2025, and the COVID-19 Prevention and Control Program.

2. Flexibly manage, closely coordinate, harmonize, and effectively implement fiscal and monetary policies and other macroeconomic policies; strictly control inflation, ensure major balances in the economy; only increase the budget deficit to increase investment spending and ensure budget balance when implementing tax exemption and reduction measures to support the Economic Recovery and Development Program (hereinafter referred to as the Program).

3. Support policies for the Program must be of sufficient scale and resources, affecting both supply and demand sides; have focused objectives, accurately identify the target groups needing support to address urgent issues, avoid dispersion and wastage of resources while ensuring the responsibility of organizations, individuals, heads, and party committees and local authorities at all levels.

4. Support policies and measures must be feasible, timely, and effective, mainly implemented over the two years 2022 and 2023 with an appropriate timeline to enhance the capacity to prevent and control COVID-19, recover and develop the economy and society; resources proposed must be capable of being disbursed and absorbed quickly.

5. Efficiently mobilize, allocate, and manage resources; reasonably balance between regions, sectors, localities, priority areas and groups; easy to implement, monitor, and evaluate; prevent corruption, rent-seeking, and abuse of policy; ensure effectiveness, fairness, transparency, and openness.

Article 2. Objectives and Indicators

1. Restore and rapidly develop production and business activities, promote growth drivers, prioritize certain important industries and fields, strive to achieve the targets for the 2021-2025 period: average annual GDP growth rate of 6.5-7%, public debt ratio below the warning level allowed by the National Assembly in Resolution No. 23/2021/QH15, urban unemployment rate under 4%; maintain macroeconomic stability, ensure major balances in the medium and long term.

2. Reduce costs, support cash flow, ensure autonomy, and facilitate businesses, economic organizations, and citizens.

3. Effectively prevent and control COVID-19; ensure social welfare and living standards of citizens, especially workers, the poor, vulnerable groups, and those heavily affected by the epidemic; ensure national defense, security, public order, and social safety.

Article 3. Support Policies for the Program to Recover and Develop the Economy and Society

1. Fiscal Policy:

1.1. Tax Exemption and Reduction Policy:

a) Reduce the value-added tax rate by 2% in 2022, applicable to goods and services currently subject to a 10% value-added tax rate (reduced to 8%), except for certain categories of goods and services including telecommunications, information technology, financial activities, banking, securities, insurance, real estate business, metals, metal products, mining products (excluding coal extraction), coke, refined petroleum products, chemical products, goods and services subject to special consumption tax;

b) Allow enterprises and organizations to deduct expenses related to support and sponsorship for activities to prevent and control the COVID-19 pandemic in Vietnam from their taxable income for the 2022 tax year.

1.2. Investment Development Policy:

Increase investment spending from the state budget by up to 176 trillion VND, focusing on the two years 2022 and 2023, including:

a) Health:

Allocate up to 14 trillion VND for new construction, renovation, upgrading, and modernization of primary healthcare facilities, preventive healthcare, regional disease control centers, enhancing the capacity of central hospitals and institutes in preventing and controlling diseases, improving the quality of human resources in the healthcare sector, domestic vaccine production, and treatment drugs for COVID-19;

b) Social Welfare, Labor, and Employment:

- Provide the Social Policy Bank with up to 5 trillion VND, including 2 trillion VND to cover interest rates and management fees for preferential loans under the Program, and up to 3 trillion VND to subsidize interest rates for borrowers under credit programs with current interest rates above 6% per annum;

- Invest in new construction, renovation, expansion, and modernization of social assistance facilities, vocational training, job creation up to 3.15 trillion VND;

c) Business Support:

- Provide interest rate subsidies (2% per annum) up to 40 trillion VND through commercial banks for key industries and sectors, businesses, cooperatives, and households capable of repaying debts and recovering; provide loans for renovating old residential buildings, building social housing, and houses for workers to purchase, rent, or lease;

- Capitalize the Tourism Development Fund up to 300 billion VND;

d) Infrastructure Development Investment:

Supplement up to 113.55 trillion VND from the state budget for infrastructure development: transportation, information technology, digital transformation, prevention and control of riverbank and coastal erosion, ensuring the safety of water reservoirs, adapting to climate change, and mitigating the consequences of natural disasters;

đ) The selection and allocation of funds for projects under the Program must ensure disbursement of Program funds within the two-year period of 2022 and 2023, and comply with the following principles and criteria:

- Prioritize funding for national key projects, projects in the mid-term public investment plan for the 2021-2025 period that are being implemented and have the potential to be completed early but have not been allocated funds or have not been allocated sufficient funds;

- In cases where funding is allocated to projects outside the mid-term public investment plan for the 2021-2025 period: only allocate funds for important and urgent projects with widespread impact, capable of rapid disbursement and immediate absorption into the economy, consistent with planning, effective use of funds, and ensuring the ability to balance funds to complete the project during the 2022-2025 period; for some newly significant projects for economic and social development, prioritize support for land clearance;

- Projects must ensure all required investment procedures;

- Ensure transparency, fairness, and balanced development between regions, areas, and localities.

1.3. Other Fiscal Policies:

a) Provide rental housing support for workers with labor relations who are renting or residing in industrial zones, export processing zones, and key economic areas (using approximately 6.6 trillion VND from increased revenue and savings in the central government budget in 2021);

b) Increase the Government's guarantee limit for domestic bond issuance for the Social Policy Bank up to 38.4 trillion VND to provide loans to support employment; students and trainees; private kindergartens and primary schools; individuals purchasing or leasing social housing, constructing or renovating and repairing houses according to social housing policies; implementing the National Target Program on Socio-Economic Development in Ethnic Minority and Mountainous Areas for the 2021-2030 period.

2. Monetary Policy:

a) Synchronize and flexibly manage monetary policy tools to contribute to maintaining macroeconomic stability, controlling inflation, ensuring the safety of credit institutions, positively supporting the recovery and development of the economy and society; study to maintain the maximum ratio of short-term capital for medium and long-term loans, reasonably calculate the reserve requirement ratio, implement open market operations, re-lending, direct credit institutions to continue reducing operating costs to strive for a reduction in lending interest rates by 0.5% to 1% over the two years 2022 and 2023, especially in priority sectors;

b) Continue restructuring loan terms and maintaining loan classification, exempting or reducing interest rates for customers affected by the COVID-19 pandemic, closely monitor economic and financial market trends to develop appropriate support measures for businesses and people while ensuring the safe operation of credit institutions;

c) Adjust liquidity appropriately to facilitate faster disbursement to beneficiaries of the subsidized interest rate package;

d) Reasonably regulate money supply, closely coordinate with fiscal policy to create favorable conditions for the issuance of government bonds and for credit institutions to continue investing in government bonds;

đ) Use up to 46 trillion VND from other legitimate sources to import vaccines, treatment drugs, and medical equipment and supplies for the prevention and control of the COVID-19 pandemic when necessary.

e) Continue to provide additional capital to the Vietnam Social Policy Bank to lend to employers for paying wages during work stoppages, wages for resuming production for workers, ensuring feasibility and rapid implementation in practice. Balance monetary policy solutions supporting the Program with the overall restructuring plan for banks under special control.

3. Other policies:

Apply other policies to implement the Program concentrated in the two years 2022 and 2023, including:

a) Using approximately 5 trillion VND from the Vietnam Universal Telecommunications Service Fund to develop telecommunications infrastructure and internet, including using 1 trillion VND to equip tablets for the "Waves and Computers for Students" Program;

b) Resolving difficulties in regulations regarding the content of expenditures and management of the Enterprise Science and Technology Development Fund; using approximately 5 trillion VND to innovate technology, incubate technology, incubate science and technology enterprises, commercialize research results and technological development; decode technology; purchase equipment, machinery, raw materials for technological innovation, directly serving business operations of enterprises.

Article 4. Resource Mobilization Plan

1. To have resources to implement fiscal support policies for the Program, allow the increase in the government budget deficit in the two years 2022 and 2023 by an average of 1% - 1.2% of GDP per year (maximum 240 trillion VND), including: in 2022, increase about 1.1% of GDP (maximum 102.8 trillion VND) compared to the approved budget estimate by the National Assembly; in 2023, the Government will consolidate the plan and budget estimate for the entire state budget for both the additional part of the Program and the year 2023, and submit it to the National Assembly for consideration and decision according to regulations.

The need for resources must be calculated specifically based on maximizing existing resources, sources of increased revenue, budget savings at the central level, and the ability to disburse funds to build appropriate mobilization plans at each stage through the following tools:

a) Issuing government bonds, ensuring the principle of close coordination in managing monetary policy, fiscal policy, and other macroeconomic policies, maintaining macroeconomic stability, financial and monetary markets, and ensuring major balances; consistent with debt repayment capacity, disbursement capacity, economic absorption capacity, ensuring efficiency, avoiding waste. Prioritize issuing domestic currency government bonds within the country, with an average issuance term possibly below nine years in 2022 and 2023. In necessary cases of issuing in foreign currency, the Government shall report to the competent authority for examination and decision before implementation;

b) Borrowing Official Development Assistance (ODA), concessional loans from abroad in the form of budget balance support;

c) In necessary cases, the Government shall report to the competent authority to permit borrowing from other legitimate financial sources that are suitable and repayable when there are funds in the annual financial and state budget plan or other sources as prescribed; permit direct issuance of government bonds to the State Bank of Vietnam.

2. Strengthen other measures to exploit resources, including:

a) Maximizing and effectively utilizing resources in medium-term plans for the period 2021-2025; minimizing expenditure cuts as much as possible, flexibly adjusting between tasks and expenditure items within the scope of authority. Strictly manage revenue sources, striving to increase revenue, thoroughly cut state budget expenditure; accelerate the tax reform process, combat tax evasion, transfer pricing, and tax avoidance, reduce the tax arrears ratio; modernize the tax, customs, and state treasury systems, implement electronic invoices, fully utilize potential increases in state budget revenue, especially potential increases in cross-border digital transactions and digital platform services provided to consumers in Vietnam; thoroughly recover frequently delayed regular expenditure funds and delayed implementation;

b) Flexibly use appropriate mechanisms, policies, and tools to mobilize additional resources to implement the Program; develop a plan to increase special consumption taxes on certain goods that need to be restricted in consumption to apply promptly during the Program's implementation period; accelerate the process of equitization, divestment of state-owned enterprises, capital from trade unions and political-social organizations; review non-state budget financial funds, investment capacity of the State Capital Investment Corporation to have appropriate mobilization and utilization plans; study solutions to mobilize entrusted capital from local budgets for the Vietnam Social Policy Bank; pay attention to effectively integrate and accelerate disbursement of national target programs, health facility investment support programs in localities.

Article 5. Application of special mechanisms

1. The Prime Minister and heads of competent authorities shall be permitted to examine and decide on the designation of tenders for the years 2022 and 2023 for consultancy packages, packages serving the relocation of technical infrastructure, compensation and land clearance packages, resettlement packages, construction and installation packages of national key projects, large-scale critical infrastructure projects concerning transportation and healthcare under the Program; contractors implementing the aforementioned packages shall continue until completion of the projects. The procedures for tender designation shall be carried out in accordance with the laws on bidding.

2. In the years 2022 and 2023, contractors shall not have to go through the procedure for obtaining mining exploitation permits for ordinary construction materials within the scope of material survey documents for national key transportation infrastructure projects under the Program; mining activities specified in this clause shall continue until project completion. Contractors shall be responsible for conducting environmental impact assessments; they shall be subject to management and supervision over mining and material usage; they shall pay taxes and fees and fulfill environmental protection, improvement, and restoration obligations in accordance with the law.

3. In the years 2022 and 2023, the Prime Minister shall be permitted to examine and decide on the delegation of authority to provincial People's Committees in areas with sufficient capacity and experience in management and with written proposals to act as the managing agencies for expressway sections under the Program (excluding the North-South Expressway Project Phase 2021-2025 managed uniformly by the Ministry of Transport) based on the maximum utilization of the Ministry of Transport’s capacity. Managing agencies specified in this clause shall implement expressway sections until project completion.

Article 6. Assignment to the Government

1. Promptly issue measures to implement fiscal, monetary policies, and other policies within its jurisdiction as prescribed by law to execute the Program; guide the implementation of the mechanisms stipulated in Article 5 of this Resolution, attaching specific responsibilities to ensure that policy exploitation, interest groups, loss of funds, and wastage do not occur.

2. In managing, directing the mobilization, allocation, management, and use of resources, it must be done economically and effectively, in line with the progress and disbursement of projects and budgetary tasks under the Program; closely monitor macroeconomic indicators to promptly take measures to ensure macroeconomic stability, major balances, particularly focusing on inflation and bad debt targets; strive to increase revenue, reduce expenditure; decrease the deficit to achieve targets in the National Financial Plan and public borrowing and repayment for the 2021-2025 period; in case of significant fluctuations or risks, the Government shall promptly report to the National Assembly for consideration and decision.

3. Direct the development of plans for the state budget allocation and supplementary investment plan for 2022 for programs and projects under the Medium-Term Investment Plan for 2021-2025 and projects under the Program (including contents related to the Social Policy Bank, Tourism Development Fund...); report to the Standing Committee of the National Assembly for consideration and decision on allocation and supplementary budget before the Government allocates and supplements the budget and investment plan for 2022.

Direct the development of plans to increase share capital from post-tax profits and reserves during the 2021-2023 period for joint-stock commercial banks held by the State with more than 50% share capital and from the state budget for the Agricultural Development Bank.

4. Based on the principles and criteria stipulated in Clause 1, Article 3 of this Resolution, promptly review and complete the list of projects using Program funds, report to the Standing Committee of the National Assembly for comments before allocating funds. Ensure the balance of public investment capital in the Medium-Term Investment Plan for 2021-2025 and public investment capital in fiscal and monetary policies supporting the Program to prioritize funding for key projects with spillover effects, regional connectivity, promoting growth, and the ability to absorb capital. Report to the Standing Committee of the National Assembly for consideration and decision on supplementary state budget estimates and investment plans for 2022, and report to the National Assembly for consideration and decision on supplementary state budget estimates and investment plans for 2023 according to regulations to accelerate progress and complete disbursement of Program funds in 2022 and 2023; ensure funding sources for the implementation and completion of component projects in the North-South Expressway Construction Project Phase 2021-2025.

5. Implement the main tasks and solutions of the Program synchronously, promptly, and effectively. During the execution process, continue to balance the central budget to supplement resources for the Program in line with actual conditions; promptly implement measures to maximize reasonable resource mobilization for the Program.

6. Flexibly adjust between the Program's budgetary tasks according to current laws for matters within its jurisdiction. For issues within the jurisdiction of the National Assembly, report to the National Assembly for consideration and decision; in urgent cases between two sessions of the National Assembly, report to the Standing Committee of the National Assembly for consideration and decision and report to the National Assembly at the nearest session.

7. Proactively and promptly issue and effectively and synchronously implement the COVID-19 Prevention and Control Program and related provisions; cut, simplify administrative procedures, improve the business environment; focus on resolving bottlenecks related to social housing, worker housing; adopt breakthrough policies to encourage innovation, digital transformation, digital economy, green economy, circular economy linked to sustainable development.

8. Study options to allow enterprises to deduct additional expenses at a certain ratio based on actual costs when calculating corporate income tax, applicable to costs for fixed assets and labor; increase tax on securities transactions and real estate, report to the Standing Committee of the National Assembly for consideration and decision.

9. Strengthen inspection, supervision, and internal guidance from the outset to prevent errors, corruption, waste, and negative practices; strictly handle violations, especially in the context of allocating large resources over a short period.

10. Emphasize information and communication work to contribute to social consensus, inspire, and mobilize the strength of national solidarity, the political system.

Article 7. Implementation Organization

1. The Government, central ministries and agencies, and localities must enhance responsibility, particularly the leadership's responsibility in directing and implementing the contents and policies stipulated in this Resolution, ensuring consistency with viewpoints, objectives, transparency, effectiveness, feasibility, and progress; prevent policy exploitation, loss, and waste.

2. The Standing Committee of the National Assembly, the Ethnic Council, and the Committees of the National Assembly, Delegations of National Assembly members, provincial People's Councils, the Vietnam Fatherland Front, and its member organizations, within their respective duties and powers, shall supervise the implementation of this Resolution.

3. The State Audit Organization shall organize annual audits of the implementation of the Program, ensuring prompt, effective, transparent, and anti-corruption measures; report to the National Assembly at the final sessions of 2022 and 2023, and the mid-year session of 2024.

Article 8. Implementation clause

1. This Resolution takes effect from January 11, 2022 to December 31, 2023; specifically, the fiscal policies stipulated in Points 1.2 and 1.3 of Clause 1, Article 3 of this Resolution shall be applied for the 2022 and 2023 fiscal years.

2. The Government shall guide and implement this Resolution; report to the National Assembly at the final sessions of 2022 and 2023, and submit a summary report at the mid-year session of 2024.

This Resolution was adopted by the National Assembly of the Socialist Republic of Vietnam, the 15th term, at its first extraordinary session on January 11, 2022.

SPEAKER OF THE NATIONAL ASSEMBLY

(Signed)

Vu Dinh Hue