DECREE

DETAILING THE IMPLEMENTATION OF THE LAW ON LAND USE RIGHT TRANSFER TAX AND THE LAW AMENDING AND SUPPLEMENTING A NUMBER OF ARTICLES OF THE LAW ON LAND USE RIGHT TRANSFER TAX

THE GOVERNMENT

Pursuant to the Law on Organization of the Government of September 30, 1992;
Pursuant to the June 22, 1994 Law on Land Use Right Transfer Tax and the December 21, 1999 Law No.17/1999/QH10 Amending and Supplementing a Number of Articles of the Law on Land Use Right Transfer Tax;
At the proposal of the Finance Minister,

DECREES:

Chapter I

GENERAL PROVISIONS

Article 1.- Tax payers

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Article 2.- Taxed objects

Objects liable to the land use right transfer tax is the value of the land area on the use right transfer as prescribed by law, including land with houses and constructions thereon.

Article 3.- Tax-free cases

The following cases shall not be liable to the land use right transfer tax:

1. The State allots or leases land to organizations, family households or individuals for use according to the provisions of the land legislation;

2. Organizations, family households or individuals returns land to the State or the State recovers land under the provisions of the land legislation;

3. The State sells the State-owned houses together with the land use right transfer to the house buyers;

4. The land use right is transferred in case of divorce or land use right inheritance according to the provisions of law;

5. The land use right is transferred between wife and husband; father or mother, foster- father or foster- mother and their offspring or adopted children; paternal or maternal grandparents and their grand children; and between siblings;

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7. Organizations, family households or individuals donate their land use right to the People�s Committees of different levels or to political organizations, socio-political organizations, social organizations, socio-professional organizations or economic organizations for the construction of cultural, educational, medical, physical training and sport establishments; or charity establishments, including houses of compassion or gratitude, orphanages, sanatoriums for elderlies, homes for lonely aged or disabled people, and other humanitarian establishments for non-commercial purposes under projects already ratified or approved by the competent State authorities in conformity with the planning.

Chapter II

TAX CALCULATION BASES

Article 4.- Tax calculation bases

Bases for calculation of the land use right transfer tax are the land area on the right transfer, land prices and land use right transfer tax rates.

Article 5.- The tax-calculation land area

The land area for calculation of the land use right transfer tax is the actual land area on the right transfer as inscribed in the land use right transfer contract certified by the People’s Committee of the district, provincial town or city, for land of family households and individuals; or by the provincial/municipal Land Administration or Land-Housing Administration, for land of organizations.

Article 6.- The tax-calculation land prices

1. Land prices for calculation of the land use right transfer tax are the prices set by the People’s Committees of the provinces or centrally-run cities, according to Government’s price bracket for different land categories, which shall be publicly posted up at the tax agencies and land administration offices.

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Where the land use right is transferred together with the sale of assets affixed thereto in form of auction while the land prices cannot be determined separately from the auction-winning prices, the tax-calculation land prices shall be the land prices set by the People’s Committees of the provinces or centrally-run cities, according to the Government’s price bracket for different land categories.

3. Where apartments in multi-storied and multi- apartment buildings are sold together with the land use right transfer, the tax-calculation land prices shall be determined according to the coefficients prescribed for different stories by the Government’s Decree No.61/CP of July 5, 1994 on dwelling house purchase, sale and trading.

4. For the transfer of the right to use pond or garden land in rural population areas or residential land in urban areas, the land prices for calculation of the land use right transfer tax shall be determined according to the land categories inscribed in the land use right certificates or the land categories currently subject to the tax payment: if the tax is being paid for the agricultural land use, the tax calculation prices shall be the agricultural land prices; if the tax is being paid for the housing-land, the tax calculation prices shall be the residential land prices.

Article 7.- Tax rates

1. The land use right transfer tax rates are stipulated as follows:

a/ For land used for agricultural production, forestry, aquaculture and salt making, the tax rate shall be 2% (two per cent);

b/ For residential land, land for project construction and land of categories other than those defined at Point a, Clause 1 of this Article, the tax rate shall be 4% (four per cent).

2. The determination of land categories for application of the above-mentioned tax rates must be based on the land use right certificates or land-use purposes already declared for tax payment, which must be certified by the competent State authorities in the land use right transfer contracts.

Chapter III

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Article 8.- Tax exemption

The following subjects and cases shall be exempt from land use right transfer tax:

1. Family households or individuals that transfer the land use right to move to settle down in new economic zones, mountainous regions or islands under decisions of the competent State agencies;

2. Persons who are conferred the "heroic Vietnamese mother" title by the State and transfer their land use right;

3. The transfer of the right to use land of various types in rural mountain or island communes as prescribed by the Government;

4. The exchange of land used for agricultural production, forestry, aquaculture or salt-making in order to meet the farming conditions;

5. Economic organizations allotted land by the State with the collection of land use levies for investment in the construction of dwelling houses for sale or construction of infrastructure for assignment or lease of the right to use land associated with such houses or infrastructure shall be exempt from the land use right transfer tax corresponding to the land area for which the land use levy has been paid under each project.

Other cases of real estate dealing with the transfer of the land use right shall not be entitled to the land use right transfer tax exemption prescribed in this Clause.

Article 9.- Tax reduction

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1. War invalids of 1/4 and 2/4 grades, and diseased armymen of 1/3 and 2/3 grades;

2. Members of families of the fallen combatants, who are entitled to the State support regime;

3. Disabled people who are no longer possessed of the working capacity, the minors and lonely aged people having no one to support.

Article 10.- Implementation of tax exemption and reduction

1. Those people entitled to the land use right transfer tax exemption or reduction stipulated in Clauses 1, 2, 3 and 4, Article 8 and Article 9 of this Decree shall be considered for the land use right transfer tax exemption or reduction only once.

2. Family households or individuals to be considered for the land use right transfer tax exemption or reduction must meet one of the following conditions:

a/ Being the holder of the land use right certificate or certificate of dwelling house ownership right and residential land use right;

b/ Sharing the land use right in the family household when assigned land or transferred with the land use right.

3. Where in one family household there are many people entitled to the land use right transfer tax reduction, the deduction levels shall be added up into the common reduction level for the family household, which, however, must not exceed 100% of the land use right transfer tax amount payable to the State budget.

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Chapter IV

TAX DECLARATION AND PAYMENT

Article 11.- Tax declaration

1. Within 15 days after the competent agency allows the land use right transfer, concerned organizations, family households or individuals shall have to declare with the tax agency of the locality where exist the land on the use right transfer, the land category, area, location and value according to the declaration form of the tax agency.

2. Where organizations, family households or individuals with the land use right mortgage or use as guaranty the right to use such land or assets affixed thereto, that, have to transfer the land use right or sell assets together with the transfer of their land use right in order to pay debts, the persons having the land use right or the agencies, organizations or individuals that take charge of filling in the land use right transfer procedures shall have to declare and pay the land use right transfer tax before paying debts.

3. Where the competent State agencies, in the course of performing their duties, transfer the land use right according to law provisions, such agencies shall have to declare and pay the land use right transfer tax.

4. In case of the land use right exchange with each other, each party to the exchange shall have to declare the land use right transfer tax for the value of the exchanged land under guidance of the tax agency.

Article 12.- Tax payment

1. Organizations, family households or individuals that transfer the land use right (referred collectively to as the land use right transferors) shall have to pay the land use right transfer tax according to notices of the tax agencies.

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The land use right transferees may agree to pay tax for the land use right transferors; for this case, the land use right transferees shall have to declare and pay the land use right transfer tax.

2. The tax must be paid within 30 days after the land use right transfer tax declarer receives a notice from the tax agency.

3. The competent State agency shall grant the land use right certificates to the land use right transferees only when the land use right transfer tax has been fully paid, except for cases of debiting the land use right transfer tax under the Government’s stipulations.

Article 13.- Tasks and powers of the tax agency

1. Upon receiving the land use right transfer tax declaration dossier from a tax payer, the tax agency shall have to give the latter a receipt and open book for daily monitoring.

2. To guide the tax payer to declare in full and according to procedures the payment of the land use right transfer tax.

3. To request the tax payer to fully supply the dossier, which includes: the land use right transfer contract with the competent agency’s certification, permitting the land use right transfer; the land use right certificate and papers related to the land use right transfer tax exemption or reduction.

4. To check and verify documents which serve as basis for tax calculation, exemption or reduction as well as the determination of payable tax amount.

5. Basing itself on the tax declaration dossier of the tax payer, the tax agency shall, within 30 days after receiving a full dossier and the land use right transfer tax declaration, have to make the tax calculation and notify the tax payer of the tax exemption or reduction amount, the payable tax amount as well as the tax payment deadline.

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7. To consider and settle complaints on land use right transfer tax according to its competence.

Article 14.- Organization of tax collection and payment

1. The land use right transfer tax shall be paid in Vietnamese currency at the State Treasury of the locality where exists the land on the use right transfer.

2. Upon collecting tax, the State Treasury shall have to give tax collection receipts issued by the Finance Ministry to the tax payers for use as vouchers evidencing their full payment of tax as prescribed and for their submission together with the dossiers to the land administration to fill in the procedures for granting the land use right certificates.

3. Where the land use right transfer tax is paid in installments, the State Treasury shall have to issue tax collection receipt for each time of payment and monitor the situation till the tax is fully paid before certifying the full tax payment and transferring the dossier to the land administration to fill in the procedures for granting the land use right certificate.

Chapter V

COMPLAINTS, HANDLING OF VIOLATIONS AND COMMENDATION

Article 15.- Complaints

The lodging and settlement of complaints about land use right transfer tax shall comply with the provisions of Articles 22, 23, 24 and 25 of the Law on Land Use Right Transfer Tax and other legal documents providing for complaints and denunciations related to the land legislation.

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The tax agencies, tax officials, tax payers and any individuals that commit violations of the legislation on land use right transfer tax shall be handled according to the provisions of Articles 17, 18, 19 and 20 of the Law on Land Use Right Transfer Tax and the Government’s regulations on sanctioning administrative violations in the field of tax.

Article 17.- Commendation

Tax agencies and officials that well fulfill their assigned tasks and persons who have merits in detecting violations of the Law on Land Use Right Transfer Tax shall be commended or rewarded according to the State’s common regime.

Chapter VI

IMPLEMENTATION PROVISIONS

Article 18.- Organization of implementation

The Finance Ministry shall guide the implementation of this Decree.

The ministers, the heads of the ministerial-level agencies, the heads of the agencies attached to the Government, and the presidents of the People’s Committees of the provinces and centrally-run cities shall have to implement this Decree.

Article 19.- Handling of the remaining problems

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2. For cases of land use right transfer before January 1st, 2000 where the land use right transfer tax has been declared and partially paid, the payable tax amount shall be re-calculated at the tax rates prescribed in the Law Amending and Supplementing a Number of Articles of the Law on Land Use Right Transfer Tax as follows:

a/ If the tax amount paid before January 1st, 2000 is smaller than the re-calculated payable tax amount, the tax arrears must be fully paid;

b/ If the tax amount paid before January 1st, 2000 is bigger than the re-calculated payable tax amount, the overpaid tax amount shall not be reimbursed.

3. For cases of land use right transfer before January 1st, 2000 where exits one of the valid papers on land use right defined in Clause 2, Article 3 of the Government’s Decree No.17/1999/ND-CP of March 29, 1999, including cases of land use right transfer for many times, by many owners, when the current users fill in the procedures of application for the land use right certificates or certificates of the dwelling house ownership right and the residential land use right, they shall have to pay the land use right transfer tax only once according to the provisions of this Decree.

4. If the persons obliged to pay the land use right transfer tax under the provisions of Clauses 1, 2 and 3 of this Article really meet with difficulties and are unable to fully pay the land use right tax as certified by the commune/ward/township People’s Committees, they shall have their land use right transfer tax arrears debited by the State Treasuries, which shall transfer the dossiers to the land administrations to fill in the procedures for granting the land use right certificates, clearly stating the outstanding land use right transfer tax amounts.

Article 20.- Implementation effect

This Decree takes effect as from January 1st, 2000 and replaces the Government’s Decree No.114/CP of September 5, 1994 detailing the implementation of the Law on Land Use Right Transfer Tax.

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