Tax cuts provide direct support, helping companies and household businesses optimize cash flow and reduce costs in the short term.

However, looking at the realities facing the private sector today, tax cuts, while valuable, appear to be only a necessary condition. A sufficient condition, also the biggest craving of entrepreneur community and business households, is a safe transparent business environment, where administrative procedures are thoroughly simplified and, most importantly, the psychology of fear of being punished unreasonably or having "criminalized" economic relations is eliminated.

First, it is important to look at the nature of tax exemptions and reductions. Taxes are financial obligations that businesses and household businesses have to fulfill based on their business performance. When a business turns a profit or generates revenue, even a reduction of a few percentage points in the tax rate allows it to retain more money for reinvestment or improving its competitiveness.

Yet tax cuts can only work when businesses are still operating and able to stay in business. Tax expenses are not the only barrier - nor necessarily the biggest one - weighing on companies and household businesses. Legal compliance costs, time spent dealing with administrative procedures, and "informal costs" arising during licensing, inspections, and examinations are the major obstacles holding back the economy's ability to break through.

The inconvenience of administrative procedures has long seemed to become a chronic ailment. An investment project or business facility wishing to operate must pass through countless levels of appraisal, from investment licensing, planning, land, and environmental clearances to fire prevention and fighting. Overlaps among normative legal documents, combined with the habit of "banning what cannot be managed" or arbitrary legal interpretation at the local level, force businesses to lose months, or even years, just to complete paperwork.

In business, time is money and market opportunity. A 2 percent or 5 percent tax cut policy can by no means offset the losses incurred when a project is stalled due to procedural bottlenecks.

Specifically for the household business sector, a large yet vulnerable force, complex procedural barriers and business regulations make them constantly hesitant to grow up into enterprises. They accept remaining in the individual economic sector not to save on tax money, but out of fear of a series of complex bookkeeping, accounting, and specialized inspection obligations that exceed their governance capacity.

Alongside cumbersome procedures, the burden of administrative sanctions and the high frequency of inspections and audits are also worrisome realities. Businesses and household businesses constantly face the risk of being fined for minor technical errors, or even due to ambiguities in how enforcement officials interpret regulations.

When legal regulations lack consistency, the line between right and wrong becomes frail, while decision-making power rests in the hands of inspectors. This creates room for a "ask and grant" mechanism and harassment to develop, pushing compliance costs for businesses very high.

Penalties aimed at education and bringing business activities into order are necessary, but penalties designed to squeeze revenue or catch flaws to impose heavy fines are counterproductive, extinguishing genuine business motivation and forcing small business sectors into a defensive posture.

To truly create a turning point for the economy, implementing the Prime Minister's direction on tax reduction needs to be placed within a comprehensive and radical institutional reform strategy.

First, the Government should further accelerate the simplification and substantive reduction of business conditions, eliminating cumbersome procedures and infeasible standards. Administrative procedures must be digitized and made transparent to minimize direct contact between businesses and regulatory officials, thereby curbing the mechanism that generates off-the-books costs.

Second, state management mindsets must shift from pre-inspection to post-inspection based on risk management, treating businesses as entities to serve rather than merely entities to manage.

In short, the Prime Minister's tax reduction proposal serves as a highly meaningful message of partnership for the business community. But for the business spirit among the public to truly ignite, the economy needs stronger institutional reforms.

Removing a sub-license, eliminating an unreasonable penalty regulation, and, most importantly, protecting freedom of business, property rights, and the safety of entrepreneurs against the risk of criminalizing economic relations can generate a development engine far greater than mere tax exemption and reduction figures.

Only when businesses feel safe and trust the legal system will they feel secure in investing capital, expanding operations, and contributing to the country's prosperous development.

Bui Trinh