Few State-owned enterprises in HCM City earmark funds for research and development despite the fact that since 2007 the Government has stipulated they must spend 3-10 per cent of revenues on research.
"Demand for research and development funds is real, but few companies allocate them because they are afraid of the cumbersome procedures," Do Huong Duong, deputy general director of the Phu Nhuan Service Joint Stock company, told a conference yesterday on earmarking and using research funds.
All companies were aware of the need for developing and applying technologies amid globalisation, he said.
Though the Ministry of Finance has issued a circular to guide enterprises in the setting up, operation, management and use of a fund for research and development of science and technology, many that have already set up a fund face trouble for alleged misuse.
This was because the ministry had failed to keep the tax authorities in the loop and they applied outdated guidelines while assessing if money from the fund was used as prescribed, Nguyen Thai Son, director of the Sai Gon Tax Consultant company, said.
Enterprises, who are caught in the middle, are understandably wary when it comes to creating a research fund.
Pham Ngoc Minh, deputy head of the Ministry of Science and Technology's southern office, said there were enterprises that had created the fund but did not use money from it, especially because of the tax issue.
The HCM City Taxation Department would inform its offices not to collect tax on the fund, Tran Thi Le Nga, deputy head of the department, said.
She also promised her department would ask the Ministry of Finance and Taxation General Department to issue new guidelines to eliminate the problems.