Registration fees: An important part of total State and local revenue collection

VCN - Policies on registration fees over the past time have made an important contribution to the reform of administrative procedures as well as the structure of State revenue collection.
A clear and transparent registration fee policy has created a basis for taxpayers and tax collection agencies to implement the policy well. Photo: Thuy Linh.
A clear and transparent registration fee policy has created a basis for taxpayers and tax collection agencies to implement the policy well. Photo: Thùy Linh.

Full legal policy

The Ministry of Finance said the registration fee is an amount of money that property owners must pay when registering ownership and use rights with competent State agencies. Through declaration of registration fee, the property owner is recognised as having the right to use and legal ownership of the property.

At the same time, data of the owner of the property and the characteristics and value of the property during the declaration process is managed and updated in a timely manner, contributing to data warehouse for the tax authorities and related State management agencies in the performance of State management and social management functions.

Policies related to registration fees have contributed significantly to the reform of administrative procedures; ensure transparency, clarity and consistency in the implementation process.

Along with the registration fee for houses and land, Decree No. 140/2016/ND-CP has assigned the Ministry of Finance to issue a price list for calculating the registration fee for cars and motorbikes for the country, replacing the 63 price lists of 63 provinces as before. If the actual asset transfer price on the market is lower than the price for calculating the registration fee set by the Ministry of Finance, the calculation price is the price promulgated by the Ministry of Finance. This regulation has facilitated online declaration and payment of registration fees, contributed to limiting unnecessary administrative procedures, implementing the Government's administrative reform objectives and strengthening tax administration, as well as ensuring transparency in determining revenues.

In addition, Decree No. 140/2016/ND-CP also stipulates in detail cases of exempted from registration fee, debiting registration fee, the regime of declaration, collection and payment of registration fees, ensuring compliance with regulations of legal documents and the situation.

The clear and transparent policy on registration fees has created a basis for taxpayers and tax collection agencies to implement the policy well; limiting problems and complaints from taxpayers, creating favourable conditions for tax authorities in management, and cutting administrative costs.

In addition, limitations and problems arising during implementation of the provisions of Decree No. 40/2016/ND-CP were promptly overcome and amended in Decree No. 20/2019/ND-CP. The regulations related to the price list, the price for calculating registration fee, the rate of collecting registration fee, the subjects entitled to registration fee exemption and the procedures for declaring registration fee and collection, ensure compliance with the reality and State management requirements.

Make an important contribution to the budget revenue structure

The Ministry of Finance said according to the provisions of the Law on State Budget Law, registration fee is a 100% local budget revenue. This is a revenue source that plays an important role in total local revenue, contributing to ensuring the budget for the local government. Every year, the local tax authorities review and evaluate the performance of this revenue to detect loopholes in revenue management, problems and good experiences in revenue management to have solutions to strengthen management, direction and exploit revenue sources for the budget.

Statistics of the Ministry of Finance showed the average revenue of registration fee is about 24,740 billion VND/year in 2012-2020. This revenue accounted for about 2.1% of the total State revenue; 2.9% of total domestic revenue and 4.8% of total local revenue.

"The strong growth in the revenue collected from registration fee over the years, besides the objective factors such as economic development, growth in demand for procurement and property ownership, transparency and unification of the registration fee policy system have contributed to the extension of the appropriate collection base, creating efficiency in the management of registration fee collection,” the Ministry of Finance said.

On the other hand, according to Decree No. 140/2016/ND-CP, previous cases of non-collection of registration fee will be converted to exemption to ensure compliance with the Law on Fees and Charges on the authority of the Government in the regulation of registration fee exemption (stipulates the case where the registration fee is not collected). In particular, regulations on the exemption of registration fee for land used for agricultural production, aquaculture, salt production, agricultural land due to reclamation; houses and land of science and technology firms, organisations engaging in socialisation in the fields of education and training.

Additional regulations on registration fee exemption for ships, high-speed passenger boats, ships, container ships and public passenger transport by bus using clean energy have contributed to the real support and encouragement policies of the State in agriculture and rural areas; scientific and technological research, education and training; transportation development.

The policy of allowing the debit of registration fee for land and land-attached houses of households and individuals eligible for debit contributes to solving difficulties for poor households and individuals, as well as ethnic minorities in remote areas.

In addition, in 2020, to limit the negative effects of the Covid-19 pandemic for the domestic automobile industry, the Government has promulgated Decree No. 70/2020/ND-CP, which stipulates a 50% reduction in registration fees for domestically manufactured and assembled cars to stimulate domestic consumption and at the same time contribute to stabilising the economy in the context of the Covid-19 pandemic.

By Thùy Linh/Thanh Thuy

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