Legal Counselling

Financial policies and mechanism of Vietnam’s capital

Kim Linh

15:35, 10/09/2017

The Law on the Capital 2012 of Vietnam stipulates that the capital may raise domestic investment capital by issuing municipal bonds, from voluntary contributions from organizations and individuals, and other methods of capital raising as prescribed by law.

According to the Law on the Capital 2012 of Vietnam, the budget expenditure estimate of the capital is determined based on the higher budget allocation than that of other central-affiliated cities and provinces, applicable to the stable period from 03 to 05 years.

The capital may use the budget revenues that exceed the estimate, except for the following amounts:

- The revenues from the VAT on imports;

- The differences between the receipts and expenses of the State bank;

- The revenues that are not collected by the capital, do not arise in the capital, but are recorded and paid in the capital.

For some important large-scale constructions and projects relevant to the environment, traffic, and irrigation managed by Hanoi city that exceed the ability to balance the municipal budget, the Government shall request the National Assembly to decide the support for the capital’s budget from the central budget in order to execute such projects.

The People’s Councils and People’s Committees at all levels in Hanoi shall use the allocated budget properly and efficiently when executing the programs and projects of building and developing the capital.

Legal bases: Law on the Capital 2012 of Vietnam, Decree No. 63/2017/NĐ-CP of Vietnam’s Government.

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