A Vietnamese textile factory. Photo: Ngoc Thang
Prime Minister Nguyen Tan Dung on Friday ordered local governments and state agencies to collect VND70 trillion (US$3.06 billion) in back taxes by the end of the year amid budget concerns.
The order came as the government is expected to fall short of its revenue target by at least VND31.3 trillion ($1.36 billion), due to a sharp decline in crude oil prices.
In the past few months, government agencies often publicly slammed local businesses for failing to pay taxes, blaming them for the state budget's problems.
Since July, tax offices around the country have released the names of their top tax defaulters, mostly businesses, to shame them into making payments.
Figures released by the General Department of Taxation this week showed that the name-and-shame policy has helped fetch about 17.9 percent of VND11.72 trillion ($512.76 million) owed by 563 top defaulters.
At a press conference on the same day, government spokesman Nguyen Van Nen addressed concerns about its recent report that showed total debts of 93 biggest state-owned enterprises (SOEs) expanded 8 percent to VND1,567 trillion ($68.43 billion) last year.
Nen said the companies' debts were 1.41 times higher than their equity, so they were still within the safe debt-to-equity ratio of 3.
The businesses have almost never missed their payment deadlines, he said.
The spokesman also assured that the Vietnamese government has been applying strict discipline when guaranteeing SOEs' loans.
There have been concerns that, with the government guaranteeing about 63.5 percent of SOEs' foreign debts, the sustainability of Vietnam's public debt could be threatened if the businesses fail to operate effectively.
Nen said the government guarantee SOEs' foreign loans as they are tasked with major projects, but local resources still fall short of the funding demand.
Moreover, Nen said, with the government's guarantee, the businesses' debt servicing costs are lower than when they take out loans on their own.
SOEs' debts guaranteed by the government accounted for 19 percent of the country's public debt, and was equivalent to 11.4 percent of gross domestic product, he said.
Vietnam's public debt is expected to reach 61.3 percent of gross domestic product at the end of December, while foreign debt is set to hit at 41.5 percent.