State budget revenues and expenditures in Vietnam

State budget revenues and expenditures in Vietnam (Internet image)

1. What is the state budget?

According to Clause 14, Article 4 of the Law on State Budget 2015, the State budget means all the expenditures and revenues of foreign that are estimated and realized over a certain period of time decided by competent authorities in order to perform the functions and tasks of the State.

In which, the state budget includes:

- Local government budget means state budget revenues that a local government may use, additional funding from central government budget to the local government budget, and state budget expenditures within the liabilities of the local government.

- Central government budget means state budget revenues that are given to the central regulatory agencies and state budget expenditures within the liabilities of central regulatory agencies.

 (Clause 13, 15, Article 4 of the Law on State Budget 2015)

2. State budget revenues and expenditures in Vietnam

2.1. State budget revenues in Vietnam

Specifically, according to Article 2 of Decree 163/2016/ND-CP, state budget revenues include:

- Taxes paid by organizations and individuals as prescribed in laws on taxation.

- Fees paid by organizations and individuals as prescribed by law.

- Collected charges for services provided by central regulatory agencies; if the fixed operating expenditures are determined, the charges may be deducted.

- Collected charges for services provided by central public service agencies and state-owned enterprises after being deducted to cover expenditures as prescribed by law.

- Amounts payable to State budget from economic activities of the State, including:

= Profits distributed to home country and other revenues from petroleum exploration and extraction;

= Recovery of investment by the State in business entities;

= Revenues from distributed dividends and profits of joint-stock companies, multi-member limited liability companies that have state capital;

= Revenues from post-tax profit that remains after making contributions to various funds of state-owned enterprises;

= Positive difference between revenue and expenditure of the State bank of Vietnam;

= Recovery of loans of State (including principal and interest), other than foreign loans of the Government.

- Contributions by other organizations and individuals as prescribed by law.

- Revenues from selling state-owned property, including revenues from transfer of land use right, change of purpose of land use under the management of the State.

- Land levies; land rents, water surface rents; sea-area use levies; rents and proceeds from the sale of state-owned houses.

- Revenues from property under the State ownership; revenues from issuance of mining right or issuance of the right to exploit water resources.

- Fines for administrative violations and other fines, confiscations as prescribed by law.

- Voluntary contribution of domestic and foreign organizations and individuals.

- Grant aid provided by governments of other countries, overseas organizations and individuals for Vietnam’s State, Vietnam’s government and local governments of Vietnam.

- Revenues from financial reserve fund as prescribed in Article 11 of the Law on State Budget 2015.

- Other revenues prescribed by law.

2.2. State budget expenditures in Vietnam

State budget expenditures include:

- Capital expenditure includes:

= Capital expenditure on projects of the fields mentioned in Clause 3, Article 3 of Decree 163/2016/ND-CP;

= Investment in and support of capital for enterprises providing public services and products ordered by the State; business organizations and central and local financial institutions; investment of state capital in enterprises prescribed by law;

= Other capital expenditures prescribed by law.

= Expenditure on national reserve.

- Recurrent expenditures in the following fields:

= Defense;

= Social safety, security, and order;

= Education and vocational training;

= Science and technology;

= Healthcare, population, and families;

= Culture and information;

= Radio, television, and the press;

= Sports;

= Environmental protection;

= Economic activities;

= Operation of regulatory agencies, the Communist Party of Vietnam and socio-political organizations, including: Committee of Vietnamese Fatherland Front, Confederation of Labor of Vietnam, Communist Youth Union of Ho Chi Minh City, Vietnam Veterans Association, Vietnam Women's Union, Vietnam Farmers' Union; support for operation of socio-political-professional organizations, social organizations, socio-professional organizations as prescribed by law;

= Expenditures on social security, including expenditures on support for implementation of social policies as prescribed by law;

= Other recurrent expenditures prescribed by law.

- Payment of interests, charges and other expenses associated with the loans taken by the Government or government of provinces.

- Aid granted from central budget to overseas Governments and organizations.

- Grant of loans prescribed by law.

- Provision of additional funding for financial reserve fund.

- Expenditures carried over to next year’s budget.

- Provision of additional funding for budget balancing, provision of dedicated additional funding for inferior budgets from the superior budget.

(Article 3 of Decree 163/2016/ND-CP)

Thanh Rin

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