Strategic Revenue Growth And National Fiscal Achievements
Vietnam has concluded a remarkable year of budgetary management, marked by significant fiscal achievements that have surpassed initial government expectations and set a solid foundation for the upcoming 2026 to 2030 development period. According to the latest estimates approved by the National Assembly, the state budget revenue for 2025 is projected to reach nearly 1.97 quadrillion Vietnamese dong, representing a substantial increase of more than 15 percent compared with the 2024 estimate.
This positive trend in revenue collection is a direct reflection of a robust recovery in domestic production and business activities, alongside a notable improvement in import and export performance across major economic hubs. Deputy Minister of Finance Do Thanh Trung recently noted that as of mid-December, actual budget revenue had already reached approximately 2.47 quadrillion dong, exceeding the annual estimate by a staggering 25 percent.
This success is attributed to the effectiveness of comprehensive revenue management measures, including aggressive efforts to prevent revenue losses and combat transfer pricing while expanding the tax base through digital transformation. Despite a significant allocation of resources toward wage reform and social welfare, the government has managed to keep the budget deficit at approximately 3.8 percent of GDP, showcasing a high level of fiscal discipline.
These milestones are essential as the nation prepares to transition into a new phase of economic expansion where financial stability will be the primary driver of sovereign credit ratings and international investor confidence. By maintaining this trajectory, the administration is ensuring that the state remains resilient against external shocks while possessing the liquidity necessary to fund large-scale national transformations.
Prioritizing Public Investment For Infrastructure And Growth
The 2025 budget has been meticulously restructured to prioritize development investment, identifying public capital as one of the most critical drivers of national growth during a period when private and foreign investment remained somewhat cautious. The public investment plan for the year was allocated at historically high levels, focusing heavily on transformative transport infrastructure, energy transition initiatives, and the expansion of digital infrastructure to support a modern economy.
According to reports from the Ministry of Finance, disbursement of public investment capital reached over 603 trillion dong by late December, reflecting a significant improvement in the speed and efficiency of capital deployment. This progress is the result of tightened disbursement discipline and clearer accountability for agency heads, which have helped address long-standing bottlenecks related to site clearance and bidding procedures.
Major nationally important projects, such as the North–South Expressway Phase 2 and the Long Thanh International Airport, have seen accelerated construction progress, which is expected to create vast new development spaces in the medium and long terms. Furthermore, urban connectivity projects like Ring Road 4 in the Ha Noi Capital Region and Ring Road 3 in Ho Chi Minh City are receiving concentrated funding to reduce logistics costs and enhance regional competitiveness.
These fiscal achievements in infrastructure funding ensure that the physical backbone of the country is modernized to facilitate faster trade flows and support the rising demand of the industrial sector. By channeling state funds into these high-impact projects, the government is effectively de-risking the environment for future private sector participation and ensuring that the national logistics network can sustain higher levels of economic activity.
Balanced Fiscal Measures For Social Security And Business Support
In addition to infrastructure, the fiscal policy of 2025 has focused on balancing revenue assurance with flexible support for businesses and households to stimulate overall market demand. A range of fiscal measures was introduced throughout the year, including significant tax exemptions, reductions, and extensions that played a key role in supporting business cash flows and encouraging domestic consumption.
One of the most impactful policies was the extension of the 2 percent value-added tax reduction, which lowered the rate from 10 percent to 8 percent for a wide variety of goods and services. The total value of these tax and land rent support packages in the first eleven months of the year alone was estimated at nearly 240 trillion dong, providing a vital lifeline for small and medium-sized enterprises.
At the same time, the government successfully carried out a massive restructuring of the state apparatus, disbursing over 104 trillion dong to support the streamlining of administrative layers. While this large expenditure item placed short-term pressure on the budget balance, it is considered a necessary strategic move to reduce recurrent expenditure in the long run and enhance governance effectiveness.
The year also saw significant progress in the digital economy, with expanded use of e-invoices and information technology in tax management helping to offset revenue losses from support policies. As the capital and stock markets continue to modernize under the supervision of the State Securities Commission, the pressure on the state budget is expected to gradually decrease over time.
Analytical Commentary On Sovereign Resilience And Regional Competitiveness
From a professional financial and analytical perspective, the recent performance of the national budget represents a sophisticated balancing act that enhances regional competitiveness and sovereign resilience. We observe that the ability to exceed revenue targets by 25 percent while simultaneously executing multi-trillion dong tax relief packages is a strong indicator of a broadening economic base that is no longer solely dependent on a few key sectors.
The strategic decision to front-load administrative restructuring costs, despite the immediate budgetary impact, is a classic example of spending to save, which will likely lead to a lower structural deficit in the coming decade. Furthermore, the concentration of capital on high-multiplier infrastructure projects like the North-South Expressway is expected to yield a significant internal rate of return by lowering the cost of doing business.
Investors should note that the maintenance of a 3.8 percent deficit ceiling amid global volatility provides a powerful signal of fiscal conservatism that is often rewarded with lower sovereign risk premiums. However, the heavy reliance on domestic revenue and the continued sensitivity to credit cycles in the real estate market suggest that the transition to a more diversified capital market remains a critical priority.
The shift toward taxing the digital economy and e-commerce is not just a revenue play but a necessary modernization that aligns the local tax regime with global standards, potentially making the market more attractive for institutional funds. As the nation moves into the pivotal 2026 fiscal year, the emphasis on sustainable revenue policy and infrastructure-led growth positions the country as a standout performer in the ASEAN region.
