Vietnam cuts charges to bolster economy

Vietnam’s Ministry of Finance has introduced Circular 44/2023/TT-BTC, which outlines a reduction of fees and charges for 36 items by 10% to 50%. The aim is to provide support to individuals and businesses facing economic difficulties, recovering from the pandemic, and navigating international fluctuations.

The implementation of these reduced fees and charges from now until the end of 2023 is estimated to lead to a decrease in state budget revenue of approximately 700 billion VND, according to the Ministry of Finance.

Among the 36 items, 21 fees will be reduced by 50%. This includes fees related to citizen identification card issuance, license issuance and operation for banks and non-bank credit institutions, construction organisation operational capacity certificates, construction individual professional practice certificates, construction investment project appraisal fees, international and domestic travel service fees, tourist guide card appraisal fees, securities sector fees (excluding two specific items), non-business import publication license fees, import publication registration fees for business purposes, and industrial property ownership fees.

In addition to these fee reductions, the government had previously approved a decree to cut registration fees for domestically produced automobiles by 50%.

The reduction of various fees and charges is an effective fiscal policy tool employed by the government and state agencies to revive Vietnam’s economy and stimulate growth. By lessening the financial burden on individuals and businesses, accepting budget deficits, and accelerating economic development, the government aims to restore the country’s economic stability.

In times of recession, deflation, or when government objectives necessitate a boost in demand, expanding fiscal policies such as increased expenditures or reduced taxes are commonly employed to drive economic growth.