Recently, in Directive No. 29/CT-TTg, the Prime Minister has requested the Ministry of Finance to manage fiscal policy in a reasonable and focused manner, coordinating with monetary policy and other macroeconomic policies to promote growth, stabilize the macroeconomy, control inflation, and ensure the major balances of the economy.

The Prime Minister emphasized the need for coordinated monetary and fiscal policies to support domestic production, business, and consumption. He instructed the Ministry of Finance to implement a reasonably expansionary fiscal policy, focused and coordinated harmoniously with monetary policy to promote growth, stabilize the macroeconomy, control inflation, and ensure major economic balances. Additionally, he called for speeding up the disbursement procedures for trade promotion programs to boost domestic consumption.

Recent public opinion has praised fiscal policies for supporting people and businesses, noting that tax exemptions, reductions, and extensions have been sufficiently lengthy and impactful. Since 2020, the government has introduced numerous support policies to help businesses and citizens recover. These include the extension of tax payments and reductions in value-added tax (VAT), aimed at helping businesses and individuals overcome challenges posed by the COVID-19 pandemic.

The total support package for taxes and fees from 2020 to 2023 amounted to around 700 trillion VND, and it is expected to exceed 900 trillion VND over five years. This substantial support has provided businesses with the necessary capital to survive and recover from the pandemic. Recently, the government also approved a 50% reduction in registration fees for domestically assembled and manufactured cars, aiming to stimulate consumer demand in the year's final months.

Some economic experts now suggest returning fiscal policies to pre-pandemic normalcy, arguing that prolonged tax reductions could negatively impact national financial security. As Vietnam's economy shows positive growth, the need for expansive fiscal measures may decrease. Moving forward, the government is considering reverting fiscal policies to their normal state, with a more cautious approach, similar to pre-COVID-19 conditions.

Duy Nguyen compiled from Vietnam Financial Times