Speaking at the workshop " Net Zero - Green Transition: Opportunities for Leaders " organized by VTV on June 27, Minister of Finance Ho Duc Phoc said that recently, many financial policies have been issued to concretize the policy of developing a green economy, contributing to creating conditions to mobilize and attract investment resources towards green growth.
The Minister of Finance stated that the tax policy system has been oriented towards environmental protection, demonstrated through two groups of policies.
Firstly, policies to limit environmental pollution such as environmental protection tax, resource tax, special consumption tax on goods that harm the environment...
Second, policies to support and encourage environmental protection activities, reduce pollution and the impact of climate change.
Minister of Finance Ho Duc Phoc spoke at the workshop.
Mr. Ho Duc Phoc analyzed that for corporate income tax, the preferential policy is a corporate income tax rate of 10% for 15 years, tax exemption for no more than 4 years and a 50% reduction in corporate income tax payable for no more than the next 9 years for corporate income from new investment projects in the field of environmental protection.
Regarding value added tax, it is stipulated that the transfer of emission rights (carbon credits) does not have to be declared or paid value added tax; it is stipulated that goods and services that contribute to greening the economy are not subject to value added tax.
For special consumption tax, tax incentives for products such as biofuel, environmentally friendly cars...
Regarding state budget expenditure, the head of the Ministry of Finance said that, in the context of many difficulties in the state budget, state budget expenditure for environmental protection has been arranged annually in accordance with regulations, each year is higher than the previous year in absolute terms and reaches a rate of about 1.2% of total state budget expenditure.
" Thereby creating resources for environmental protection, prevention and response to national environmental incidents... On average, in the past 5 years, the state budget allocation for environmental protection has reached over 21,000 billion VND per year ," said Mr. Ho Duc Phoc.
Minister Ho Duc Phoc emphasized that green transformation and emission reduction to realize the "Net Zero" commitment is a long journey with many difficulties and one of the biggest challenges is the resource issue.
According to World Bank estimates, Vietnam may need to invest an additional US$368 billion by 2040, equivalent to 6.8% of GDP per year, as it pursues a development path that combines resilience and net zero emissions. Of this, the decarbonization journey to meet international commitments accounts for about 30% of the resource demand.
" However, the public sector will only be able to meet about one-third of the required resources; while the green financial market is currently in its early stages of development, the resources mobilized through the green financial market are very small compared to the demand ," Mr. Ho Duc Phoc informed.
Currently, the Ministry of Finance is focusing on reforming the tax system, managing public debt and restructuring the State budget to reasonably mobilize resources for the State budget; improve fiscal space; create favorable conditions for mobilizing, allocating and effectively using financial resources, harmoniously solving economic, social and environmental development issues, ensuring national defense and security and social security.
At the same time, to address the lack of resources for green growth and climate change response, in addition to promoting internal resources, Vietnam needs to strengthen cooperation and support from the international community. Accordingly, in addition to prioritizing public resources, the Ministry of Finance will actively coordinate with relevant ministries and sectors in researching solutions to mobilize private resources and international organizations.
In particular, developing the green financial market and carbon market are priorities that need to be implemented with focuses such as: Developing green financial instruments and sustainable finance; encouraging localities and enterprises to issue green bonds; attracting institutional and individual investors to invest in green financial instruments.
Minister Ho Duc Phoc said that in the coming time, the Ministry of Finance will continue to coordinate with the Ministry of Natural Resources and Environment and relevant agencies to develop a decision of the Prime Minister to promulgate a green classification list according to the assigned tasks in Decree No. 08/2022/ND-CP, as a basis for issuers to select green projects to use capital from green bonds.
For the domestic carbon market, the development and implementation roadmap has been issued by the Government in Decree No. 06/2022/ND-CP on regulations on greenhouse gas emission reduction and ozone layer protection.
The Minister of Finance said that from now until the end of 2027, the focus will be on building a system of regulations and policies to create a foundation for the market to operate as well as establishing and organizing a pilot operation of a carbon credit trading floor, aiming to officially operate the carbon credit trading floor in 2028.
" As the agency assigned to preside over the development and establishment of a carbon credit trading floor and promulgate a financial management mechanism for the operation of the carbon market, the Ministry of Finance is researching and developing a Carbon Market Development Project to submit to the Prime Minister for approval ," Minister Ho Duc Phoc added.
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