Source: VOVNEWS

The reduction and deferment of tax payments may place pressure on the State budget and negatively affect the nation’s key projects, but if the National Assembly (NA) does not approve this action, the situation may be worse in 2013.

At an interview with reporters on the sidelines of the ongoing NA session, Deputy Tran Du Lich from HCM City said the NA Committee for Finance and Budget does not back tax exemptions for home-based businesses.

However, he said these businesses are a very important economic sector that greatly contributes to boosting economic growth and ensuring employment. Therefore, it is necessary to reconsider the tax policy to help them overcome difficulties.

Regarding the successful containment of inflation, Deputy Lich said the slowdown of inflation in late 2011 and early 2012, especially in April and May, is a positive sign. But he also expressed concern that this was due to falling purchasing power and demand.

The decline in the trade deficit should be attributed to decreasing purchasing power and demand, which resulted in importing fewer materials, not to the measures taken, he said, adding that it will bounce back once the situation improves.

Referring to the country's current gloomy economic situation, Lich said that, unlike in 2009 when the depression was caused by the global economic crisis, this year’s problems stem from the domestic situation.

He also said that the monetary policies in Government Resolution 11 have helped curb inflation but they have also caused numerous difficulties for businesses.

The NA Deputy said he backs Government Resolution 13 on solutions for easing difficulties against production and supporting the market, which he claims should help businesses find a way out of the woods and promote economic growth.

The State Bank of Vietnam should ensure a 15-16 percent credit growth, he said, adding that although the banks do have capital available, it is not being pumped into the economy.

In addition, he believes tax relief and the deferment of tax payments, including value-added tax (VAT), is crucial to stimulating purchasing power.

Lich also expressed his worries about the rising unemployment rate as economic growth remains low at less than five percent.

Every year there are a million people entering working age, while 500,000 others leave the agricultural sector to look for new jobs. Deputy Lich says he is concerned about the possibility of creating 1.5 million new jobs each year in the current economic situation./.