Completing regulations on land use fees and land rent

	MoF rejects VAMA’s proposal to reduce auto registration fee by 50%
	Trillions of dong lost due to loopholes in land price declaration
	Reasons for increase of tax debt

The Ministry of Finance requests ministries, central and local agencies to report on other cases for exemption or reduction of land use fees and land rent according to the provisions of Clause 2, Article 157 of the Land Law to submit to the Government. Illustration photo: H.Anh

Determining land area before converting the use purpose

Commenting on Article 7 of the draft Decree regulating the calculation of land use fees when changing land use purposes to implement projects applicable to economic organizations, oversea Vietnamese and organizations with foreign investment, some believe that the draft Decree needs to clearly define the understanding of the deductible land area before changing the land use purpose. The reason for this is because there are currently two ways to understand it. First, the deductible land area before changing the land use purpose is the land area corresponding to the area after the change of purpose with collection of land use fees is allowed. The allotted land area without fee collection is not deducted. Second, the deductible land area before changing the land use purpose is the entire land area for project implementation, including the land area with fee collection and the land area without fee collection.

Besides, the Draft only states that for the land area before changing the purpose is, "in case the land before changing the purpose is agricultural land, non-agricultural land but residential land". So what about the case where there is residential land before changing the purpose as above, how to solve it, is it allowed to calculate the area before changing the land use purpose as residential land for deduction or not?

Regarding this opinion, the Ministry of Finance has received and revised the direction: land use fees and land rents for land types within the scope of project implementation before changing the land use purpose (hereinafter referred to as land fees before changing the land use purpose) are calculated according to the provisions of Clauses 2 and 3, Article 7.

For the land area before changing the use purpose, the Ministry of Finance said that before changing the purpose there was residential land, in the draft Decree there is a regulation: "In case of implementing a commercial housing project but the land before changing the land use purpose is within the project which has many types of land, including residential land (but not separated in the project after changing the purpose), then this residential land area is valued in the land fee before changing the purpose at the time a competent state agency issues a decision allowing the change of land use purpose”.

Adjusting detailed project planning due to management requirements

Commenting on Article 14 of the draft Decree on calculating land use fees when changing detailed planning, some said that the provisions in the draft: "in cases where due to management requirements, the State adjusts detailed planning that changes the structure of land use, the location of each type of land, and the land use coefficient, leading to an increase or decrease in land use fees" does not take into account the failure to fulfill the obligation of land use fees. It is wondered that if the project has been allocated land and is in the process of determining the land price, but the State requests to adjust the detailed planning because they find that the previous planning is not suitable for the current situation, so the previous approval decision of planning has been changed or canceled in case the land use fee obligations have not been fulfilled, how will this case be resolved?

Regarding this opinion, the Ministry of Finance said that the draft Decree stipulates a distinction between two cases: the investor requests to adjust the planning; the competent state agency decides to adjust the detailed planning of the project according to the provisions of law. Accordingly, in cases where the investor requests to adjust planning, it requires to stipulate the case in which the investor has fulfilled their financial obligations and the case in which the investor has not fulfilled their financial obligations. As for case where the competent state agency decides to adjust the detailed planning of the project due to the management requirements, there are no regulations for each case where the investor has fulfilled their financial obligations and the case where the investor has not yet fulfilled their financial obligations (because planning adjustment is due to the management requirement of state agencies).

Regarding regulations on land rent exemption and reduction, a representative of a unit in Ba Ria - Vung Tau said that the unit has been operating in the sports field from 2006, the land is leased by the State until 2051 and is currently receiving land rent exemption and reduction until 2026. According to the Land Law 2024, there is no longer a distinction between investment incentives and previously socialized areas, so the representative requested the drafting agency to clearly stipulate specific cases that must complete procedures for reduction every five years.

Regarding this issue, the Ministry of Finance said, at Point a, Clause 1, Article 157 of the 2024 Land Law stipulates: 1. The exemption or reduction of land levy or land rent shall be applied in the following cases:

a) Land is used for production and business purposes in investment incentive fields or in investment incentive areas according to investment laws and relevant laws, except land for commercial housing construction, commercial land;

Thus, the Land Law 2024 provides general provisions for both exemption and reduction of land use fees and land rents in cases of using land for production and business purposes in the field of investment incentives or in localities with investment incentive according to the provisions of investment law. However, the sports field is one of the socialized fields, according to current land law, it is given higher incentives, but in Clause 1, Article 157 of the 2024 Land Law, there are no regulations for this case. Therefore, the Ministry of Finance has issued an official dispatch requesting ministries, central and local agencies to report on other cases requesting exemption or reduction according to the provisions of Clause 2, Article 157 of the Land Law to synthesize opinions to submit to the Government to report to the National Assembly Standing Committee in accordance with the provisions of Clause 2, Article 157 of the Land Law to supplement this Decree or regulate them in a separate Decree of the Government.