VietNamNet Bridge – Experts during a seminar on Tuesday stressed the need to revise the Law on State Budget to make it more transparent, saying that the current law has exposed many serious shortcomings after nine years of implementation and is no longer suitable to the reality.

The State budget estimate is usually made and presented to the NA at year-end and final settlement is made 18 months later for NA approval. (Photo: VNN)

Speaking at the seminar on State Budget Law revisions organized last week in Ninh Binh Province, the chairman of the National Assembly’s (NA) Committee for Finance and State Budget, Phung Quoc Hien, pointed out many shortcomings of the law such as overlaps in the State budget system and competence of managing levels.

The budget collection process is complicated while collection and spending remain unclear. Collection and allocation are not reasonable and there are big problems in estimating State budget’s revenues and spending.

In addition, there are no specific and transparent regulations dictating the accountability of State management agencies before the elective agencies. The rules have yet to suit international standards as well.

Most delegates at the seminar said that it is necessary to revise the law as well as provisions in the constitution regarding financial and budget management.

According to economic experts during many major seminars or NA forums, the biggest problem is the wide difference between budget estimates and final settlement. The State budget estimate is usually made and presented to the NA at year-end and final settlement is made 18 months later for NA approval.

The difference between estimated budget revenue, for instance, and the final figure has always stood at over 60%. A budget managing agency may set up a low budget estimation while actual collection is high or vice versa.

In 2008 and 2009, State budget collection was 61.3% to 69.8% higher than projected because of higher collection of land, house, natural resources, export and import taxes. But now, many types of tariffs in the country have been reduced due to economic woes while over 20,000 enterprises have shut, cutting deeply into State budget revenues.

In the Jan-Jul period of 2013, total State budget collection was 52.6% of the estimated amount. The financial sector is unlikely to meet this year’s budget collection target.

Source: SGT