Deputy minister of finance Nguyen Duc Chi during a government meeting to discuss a 5.2 billion USD COVID-19 relief package for businesses in Hanoi on August 11. (Photo: baochinhphu.vn)

Hanoi (VNS/VNA)  - The Government is to roll out a 118 trillion VND (5.2 billion USD) COVID-19 relief package by the end of the year, said deputy minister of finance Nguyen Duc Chi during a government meeting on August 11.
 
The package's main targets are businesses that have been affected by the pandemic. If qualified, they would be eligible for tax cuts, reduction in land use fees and delays for other payments. Industries that have been severely affected by the pandemic such as tourism and transport may look forwar𝓰d to VAT tax exemptions on top of other support measures.

Another relief package worth up to 20 trillion VND is being considered to help businesses facing extraordinary difficulties. 

Notably, the ministry has proposed the Government slash taxes and fees by half for small-to-medium-sized businesses and businesses with annual sales under 200 billion VND.

"The Ministry of Finance has been gathering opinions and feedback from other ministries and Governmental agencies regarding the packages. Once completed, a proposal will be presented in the earliest working session of the National Assembly Standing Committee for review," said Chi. 

Meanwhile, major commercial banks with the State as a shareholder including Vietinbank, Vietcombank, BIDV and Agribank have agreed to cut interest rates in the amount of 4 trillion VND. The banks said they will further reduce another 4 trillion VND in interest rates for businesses in HCM City and southern Binh Duong province, and certain provinces that have been put under lockdown since late May. In addition, all banking services for said localities will be provided free of charge. 

Dao Minh Tu, deputy governor of the State Bank of Vietnam (SBV), said the SBV has instructed commercial banks to adjust interest rates since the beginning of the pandemic.

Interest rates for business loans have declined by 1.2-1.5 percent on average during last year. During the first seven months of 2021, banks have further slashed their interest rates by 0.5 percent. 

As the country fights to contain the virus. The SBV has asked banks to cut back on their own expenses to ensure they have more resources dedicated to supporting businesses. The Vietnam Banks Association and its 16 members have pledged to reduce interest rates for business in the amount of 20.5 trillion VND by the end of the year, Tu said. 

"The SBV's top priority is for businesses to receive all the support they require to mount a comeback once the pandemic is under control," he said. The SBV also said it will keep an eye on the banks to make sure they will make good on thei෴r pledges./.