Vietnam’s state budget revenue reached an unprecedented milestone in 2024, exceeding 2 quadrillion VND ($83 billion), with contributions from Hanoi and Ho Chi Minh City alone accounting for half of the total.

Hanoi and HCMC lead budget contributions

According to a report from the Ministry of Finance, the state budget revenue for 2024 increased by 15.5% compared to 2023, marking the first time Vietnam’s budget revenue surpassed 2 quadrillion VND.

Hanoi’s budget revenue exceeded 501.6 trillion VND ($20.9 billion) by the end of December 2024, breaking the 500 trillion VND milestone for the first time.

Similarly, Ho Chi Minh City’s budget revenue reached 505.3 trillion VND ($21 billion), reflecting a 13.17% year-over-year increase.

Combined, these two cities contributed over 1 quadrillion VND ($42 billion), making up 50% of the nation’s total budget revenue.

Regional disparities in budget contributions

The report highlights a long-standing issue in Vietnam’s fiscal landscape: budget revenue remains heavily reliant on a few major localities. The top 10 provinces, including Hanoi, HCMC, Hai Phong, Binh Duong, Ba Ria-Vung Tau, and Quang Ninh, generated more than 1.5 quadrillion VND ($62.5 billion), or 75% of the national total.

The remaining 53 provinces contributed just over 500 trillion VND ($21 billion). Many of these regions continue to rely on central government support for public spending and social welfare, underscoring the imbalance in fiscal self-reliance.

Despite the disparities, there has been progress in fiscal self-reliance among provinces. In 2023, 18 out of 63 localities achieved budget self-sufficiency and contributed surplus revenue to the central government.

These provinces include Ho Chi Minh City, Hanoi, Binh Duong, Dong Nai, Quang Ninh, Ba Ria-Vung Tau, Hai Phong, and Vinh Phuc. Notably, the number of self-sufficient provinces has steadily increased, from 11 during the 2007-2010 period to 18 in recent years.

This trend reflects Vietnam’s shift away from reliance on traditional revenue sources such as crude oil and imports, focusing instead on diversifying local revenue streams and strengthening fiscal foundations.

For provinces that remain dependent on central government funding, there is a pressing need to identify and cultivate new revenue sources. This includes leveraging local resources, attracting investment, and fostering economic growth, reducing reliance on “central government support.”

Achieving greater fiscal autonomy across more provinces is crucial for enhancing the resilience of Vietnam’s state budget and ensuring equitable development nationwide.

Luong Bang