Circular No. 93/2011/TT-BTC amending and supplementing Circular No. 117/2004/TT-BTC of 7 December 2004 guiding the implementation of the Government’s Decree No. 198/2004/ND-CP of 3 December 2004 on land use levy collection

60 OFFICIAL GAZETTE Issue nosOB.10/July 2011 (Gong BaD /lOS 429-4301July 31,2011) THF M1N1STRY OF FlNANCE Circular No. 93/20nffT-BTC of June 29, 2011, amending and supplemen ting Circular No. 11712004ffT-RTC of December 7, 2004, guiding the implementation of the Government's Decree No. 19812004/ND-CP of December 3, 2004, on land use levy collection Pursuant to the November 26. 2003 Land Law; Pursuant ta the Government's Decree No. 18112004/ND-CP of October 29, 2004, on e VIE'tNAIi lAW & LEGAL Issue nos 08·10/July2011 (GongBao nos 429-430/July 31,2011) OFFICiAL GAZETTE 61 implementation of tile Land Law., Pursuant to tire Government's Decree No. I 98/2004/ND-CP ofOecember 3,2004, on land use levv collection; Pursuanr to tltc Govcrnmcnts Decree No. 120/2010/ND-CP of December 30, 2010, amending and supplementing a number of articles of the Government's Decree No, 198/ 2004/ND-CP ofDecember 3,2004, on land use l evv collection; Pursuant to the Government's Decree No. lI8/2008/ND-CP of November 27, 2008, defining the functions, tasks, powers and organizational structure of The Ministry of F iuuncc, The Finance Ministry amends and supplements Circular No.1 J7120041IT-BTC of December 7. 2C04, guiding the implementation ofthe Government's Decree No. 198/2004IND CP of December 3, 2004. on land use levy collection (amended and supplemented under the Government's Decree No. 120/2()J0IND-CP ofDecember 30,2010), as follows: Article 1. To amend and supplement Section IV, Part A (guiding Clause I, Article 2 of Decree No. 120/2010/ND-CP) as follows: "1. Land prices used for land use levy calculation 1.1. In case bus ine s s olganizatiUIIS, households or individuals are allocated land by the State with land use levy collection not through land use right auction, land prices used for land use levy collection are those based on land use purposes at the time of issuance of land allocation decisions of competent state agencies; m case the time of land hand-over does not coincide with the time of allocation indicated in the land allocation decision, the land price used for land use levy caJcul ation is that based on the land use purpose at the time of actual land hand-over. The time of actual land hand-over shall be determined as follows: aI For cleared land, the time of actual land hand-over is the lime of issuance ~~cisiun on land allocation of a competent st.8kagency. hI For uncleared land. the lime of.aelualland hand-over is the time of hand-ovei' of land cleared according to the land hand-over schedule stated in the approved mvestment project; in case the time ofcompletion ofground clearance does not keep to the landftand-over schedule indicated in the approved tmestment project, the time of actual land hand..m;.eris that of hand-over of cleared land in the fteld. For a project with a ground clearance period of two or more years which docs not rndicate a land hand-over schedule, the actual land hand over shall be carried out annually according to the actual completion of land clearance in the field, 1.2. In case un economic orga~ation is penni tted by a competent state agency ID change the land use purpose for carrying out a production and business project oshousing project, the land price used for land use levy calculation is that based on the new land use purpose at the time of issuance of the decision ofcompetent authorities permitting the land use purpose change. l.3. In case a household or an individual has been granted by a competent state agency a certificate (written recognition) of the land use rights for the land currently in use or with a changed use purpose, the land price used for orr IC!At GAZFTl E62 land use levy calculation is that based on the land use purpose according to the land use right certificate or the new land use purpo;;e at the time of submission of a complete and valid dossier of application for a land use right certificate or for permission to change the land use purpose as required by the natural resources and enviJ.2!lment agency. 1.4. Land prices for land use levy calculation under Clause I, Article 2 of Decree No. 1201 201O~P are those prescribed by provincial level Pe£!!le's Committees. In case land prices prescribed by provincial-level People's Committees fail to match actual market land use right· transfer prices under normal circumstances, provincial-level People's Commitges shall base on actual market prices to decide on specific land prices as appropriate.. Particu~~, in case a household or an individual has bee,:~ranted a residential land use right certincaeetwntten recognition) for a land area which ~(;urrently in use within the use (allocat~) limit of residential land or is permittmor land use purpose change within the use {!Ulocation) limit of residential land, the land pri~for land use levy calculation is that prescribed by the provincial-level People's Commitree at the time of declaration and submis~of a complete and valid dossier of applicassea for a land use right certificate or for permiss1ml. to change land use purpose to the natura~urces and environment agency. Land prices prescribed or decided by provincial-level People's Committees are specifically guided as follows: a/Land prices prescribed by provmcial-level People's Committees are those in the land price tariffs promulgated and announced by provincial-level People's Committees on Issue nos 08·1 O/July2011 (Gong BaG nos 429·430IJu/y 31,2011) January I every year; bl Land prices decided by provincial-level People's Committees are specific land prices of each land plot under the approved planning for land use levy calculation in case land prices in the land price tariffs promulgated by provincial-level People's Committees fail to march actual market land use right transfer prices under normal circumstances and must be re-determined to match actual prices. The methods of determining land prices for land use levy calculation comply with the Government's regulations. 1.5. The determination of land prices to match actual market land usc right transfer prices referred to at Point 1.4of this Clause shall be carried out as follows: 1.5.J. For economic organizations: a/ Based on dossiers as prescr ibec, provincial-level Finance Departments shall coordinate with related provincial-level Departments and agencies in determining land prices for land use levy calculation, and subrn.t them to provincial-level People's Committees for decision in either of the following two forms: In case the land price prescribed by the provincial-level People's Committee matches market land use right transfer prices under normal circumstances, the provincial-level Finance Department shall propose the provincial-level People's Committee to decide on the application of such land price to land use levy calculation. In case the land price prescribed by the provincial-level People's Committee fails to match market land use right transfer prices under normal circumstances> thp provincial level Finance Department shall ass ume the © VIETNAM LAW &LEGAL RUM Issue nos08·1 OIJu Iy2011 (Gong Beo nos 429·4301July 31,2011) OFFICIAL GAZETTE 63 prime rcsponsibility for, and coordinate with the provincial-level Natural Resources and Environment Department, Tax Department and related agencies in, re-determining specific land prices, and submit them to the provincial-level People's Committee for decision. Based on the actual local situation, the provincial-level Finance Department shall hire a price appraisal organization to determine land prices, which shall be appraised by the provincial-level Ei n an cc Department ill coordination with the provincial-level Natural Resources and Environment Department, Tax Department and related agencies, and submitted to the provincial-level People's Committee for decision and appl ication on a case-by-case basis. In case a locality is unable to hire a price appraisal organization or the land plot val ue is small (calculated according to the land price tariff promulgated by the provincial-level People's Committee): under VND 15 billion in centrally run cities; under VND 5 billion in mountainous and highland provinces; and under VND 10 billion in remaining provinces, the provincial-level Finance Department shall report it to the prov inc i ai-Ic ve l P~ople's Cornmitreefor permission for coordination with the provincial-level Natural Resources and Environment Department, Tax Department and related agencies in determining the land price and submitting it to the provincial-level People's Committee for decision. The selection of price appraisal organizations complies with the price appraisal law Expenses in relation to the determination of land prices for land use levy calculation shall oc covered by budget funds under the state budget law. b/ Ba se.d on land prices dc c i dc d by provincial-level People's Committees and cadastral information transferred by provincial level Natural Resources and Environment Departments, provincial-level Tax Departments shall determine and notify payable land use levies to organizations with allocated land or permitted to change land use purpose, for payment according to regulations. c/ Within 10 working days fron~~ date of actual land hand over or decision t~lt lund use purpose change, economic organizations shall come to competent state agenciesdefined in provincial-level People's CCUiiKTIittees' regulations on the process of c()@4l~nation among local functional agencies in \he transfer of dossiers and determination, co~~iion and remittance of land-related financial 15OIigations (at Pomt 1.3, Clause 1, Article l) of tlfiSCircular) .~~ La declare their land use levy obli~ns. Past this time limit, if failing to I1'T:'!'k'e such declaration, they shall be penali~ by tax agencies for late declaration un'" the tax administrauon law. 1.5.2. For households and individuals: a/ Incase ofgrant of rcsidentiall~use right certificates (recognition of land us....ghts) for ' land currently in use, and change of non residential land currently in use to fle6idential land, based on dossiers of declaration for land..... use levy paympnt and cadastral i..oformatioll transfer slips for determination oflaI1'l!'use levies of households or individuals, district-level Tax Departments shall determine payable land use levies on the following grounds: For land areas within the residential land use (allocation) limit, land prices prescribed by provincial-level People's Committees at the time ot submission ot complete and valid dossiers; e VIETNAM LAW &LEGAL FOR 64 OFrlCIAL GAZETl E Issue nosOB·10/July 20'11 (CongSilOnos 429·430IJu!y 31,2011) For land areas in excess of the residential land use (allocation) limit, land prices prescribed by provincial-level People's Committees and land price adjustment co efficients. In case of land use purpose change, the diffcrence between land usc levies based on the new and old purposes shall be also determined according to the corresponding adjustnat co-efficient applicable to each categoryef land. LanQ,wicc adjustment co-efficients shul l be determingd by the provincial-level Finance De~in coordination with the provincial level N~ral Resources and Environment Departr~t and Tax Department and related ag~ncip~,..anci suhmitred to the prnvincial-lpvf>1 People's €ommittee for decision in case of collecti~of land use levies from households and indi~uals for land areas in excess of the prescribeefirnit in the same locality where exist differenj-eases for which market land prices must b~etermined for land use levy calculajssn. Such co-efficient shall be detenn~d based on the ratio between the (prevailiag) actual market land transfer price under normal circumstances at the time of detennirt1Won and the land price prescribed by the provincial-level People's Committee. The 'di:termination of land area within the. prescribedlimit for land use levy calculation referred wat this Point applies only to a single land plQt.lTJ case a household or an individual has more than one land plot, the land user may choose one of them for determining the area within the limit. The provincial-level Tax Department shall propose the provincial-level People's Committee to promulgate a regulanon guiding households and individuals to make commitments and take responsibi lity before law for their declaration of land use levies in their submitted dossiers of application fOI land me right certificates. bl In case of allocation of new residential land or grant of land use right certificates for non-agricultural production and business land arc as and application for permission to convert agricultural land into non-agricultural production and business land, based on dossiers of declaration for land use levy payment and cadastral information transfer slips for determination of land use levi es of households or individuals, district-level Tax Departments shall determine payable land use levies applicable to economic organizations under Point 1.5 (l.5.I) of this Clause. cl Based UII land use levies determined under Item a and land prices for land use levy calculation decided by competent agcncie s under Item b, Point 1.5 (I.5.2) of this Clause, district-level Tax Departments shall notify or determine and notify land use levies payublc by households and individuals according to regu lations. 2. The allocation of land usc levy for multi story buildings attached to land which is allocated by the State to multiple users shall be: carried out as follows: 2.1. For construction works being high rises, apartment buildings, houses with mixed use purposes (excluding the cases specified at Point 2.2 of this Clause), land use levy shall be allocated to each user according to the allocatior co-efficient multiplied by the housing area of each user as follows: al The allocation co-efficient shall be determined to be the ratio between house construction land area and total house area of users. bl For houses with basements, 50% of the .I.s.s.Y.!U.l.osJ}8~1OIJuly 2011 (Gong Baanos 429-430/July 31,2011) OFF1ClAL GAZETTE 65 . ----- . basement area shall be added to the total house area of users for calculating the allocation co efficient. 2.2. For the sale of houses under state ownership under the Government's Decree No. blll'P of July S, lYY4, land usc levy shall be allocated under this Decree." Article 2. To add Section V to Part A (guiding Clause 2, Article 2 of Decree No. 120/ 20 1O!ND-CP) as follows: "V, Subtraction ofcompensation and ground clearance money. 1.For cases with compensation and ground clearance plans approved by competent authorities: In case organizations or individuals that are allocated land by the State and pay land use levies have paid advances for compensation, support, resettlement and organization of ground clearance compensation according (0 approved plans, they shall be refunded by the state budget in the fonn of subtraction of the whole advances paid under approved plans from payable land usc levies. If the advances paid for compensation, support, resettlement and organization of ground clearance compensation according to approved plans are higher than payable land use levies, only the amount equal to the payable land usc levy may be subtracted, The remainder shall be included in project investment expenses, while the amount already subtracted from the payable land use levy is not allowed 10 be included in project investment expenses. In case organizations or individuals that arc allocated land and local administrations have otherwise agreed upon land allocation (for example, sparing part ofland with infrastructure 10 the locality for rmplementing social policies or meeting local needs), expenses arising from such agreement are not allowed to be subtracted from the payable land use levy. (Example 1 in an appendix to this Circular, not printed herein) 2. For cases without compensation and ground clearunce plans approved by lil'I)inpetent authorities: In case investors receive by !f1emselves lawful land usc rights transferred from organizations and individuals or reach agrccrncnt On compensation and ground clearance expenses, when they are permitted by competent authorizes to change the land use purpose for implementing investment projects under approved plans, they are not allowed to subtract but must pay land use levies based on the difference between the land pricesaccording to the new and old use purposes at the lime of land use purpose change. The above land prices according Cb new and old land usc purposes used [OJ calculating land use levy differences are those dec-ided by provincial-level People's Committees. Land prices decided by provincial-level People's Committees (for the old purpose) are lower than land prices used for calculating compensation and support amounts upon land recovery by the State, and at the same time, land prices used for calculating compensation and support amounts shall be used." Article 3. To amend and supplement Point 3, Section III, Part B (guiding Clause 3, Article '2of Decree No 120J20IOIND-CP) as follows: "3. In case land users are permitted to shift from land lease to land allocation with land use levy collection and have paid land rents, they 66 OFFICIAL GAZETTE Issue nos 08·1 OIJuly2011 (Gong Bao nos 429-430/July 31,2011) are allowed to subtract land rent amounts already paid for the remaining duration (if any) from payable land lise levies on the principle of preservation of paid SUIllS of money as follows: The unsubtracted sum of money (mentioned above) shall be converted into a percentage (fo) of paid land lise levy at the time a land user-paid lan~nt to the State, which, however, must not exc~ the payable land usc levy. The land.. price u~for land use levy calculation at the time a 1'* user paid land rent to the State for conversw into a p~reenta2e (%) of paid land use levy1Uust be determined according to the new use JSm-pose under approved planning when permittee to shift from I and lease to land allocation with land use levy collection. ~ For ttre remaining percentage (0/<,) of land-area perJ1lilted for shifting from lease to-allocatioaavith land usc levy payment, land use-levy sh<rlHJe paid according to the policy and land pri-e"; at the time of shifting under the guidane~Clause I, Artie lc I of this Circular, ....... (Exa~le 2 in an appendix to this Circular, not priliiNtl herein) .",... Artid.e 4. To add one content to the end of Section~Part B (guiding Clause 4, Article 2 of Decree-No. J20/201OIND-CP) as follows: "Theeeterminarion of residential land prices llecidel!'"' by prov inc ia l-Ievel People's ~ Co~s to match actual market land use right transfer prices at the time of grant of land use right certificates for areas in excess of the residential land allocation limit for land use levy calculation under Clauses 4 and 5, Article 8 of Decree No. 198/2004/ND-CP (supplemented under Clause 4, Article 2 of Decree No. 1201 20lU/NlJ-CP) shall be carried out accordmg to Point 1.5, Clause 1, Article 1 of this Circular." Article 5. To amend and supplement Point 4, Section 1, Part C (guiding Clause 5, Article 11 of Decree No. 198/2004/ND-CP amended under Clause 5, Article J of Deere!": No 12Ci/ 201O/ND-CP) as follows: "4. For land users who enjoy land use levy exemption or reduction under Clauses I, 2, 3 and 4, Article 12; and Clauses 1 and 3, Article 13 of Decree No. 198/2001IND CP (amended and supplemented correspondingly in Clauses 2 and 3, Article 1 of Decree No. 44/2008/ND CP) but then are permitted by competent authorities to transfer their projects, their financial obligations arc as follows: 4.1. For transferors: Transferors may not include exempted or reduced land use levy amounts in transfer pnces. 4.2. Fur transferees: at If the transferees continue to implement the projects. they will further enjoy land use levy exemption or reduction under the investment law for the remaining duration of the project; b/ If the transferees cease to implement the projects. they shall pay land use levies under the land law for the projects after they are transferred; cl If the transferors have performed part of the land-related financial obligation, the transferees are allowed to take over the part of the obligation already paid by the transferors." Article 6. To add Point 5 to Section II, Part C (guiding Clause 6, Article 2 of Decree No. 120/201O/ND·CP) as follows: "5. To exempt land use levy for land areas © VIETNAM LAW & LEGAL FORUM Issue nos08.10/JuJy 2011 (Cong Baa nos 4:f94::JUIJuly 31, :fU11) OFFICiAL GAZETTE 67 allocated for usc for hydropower reservoirs. In this case, the area of hydropower reservoir is the special-usc water surface defined at Point i, Clause 2, Article 13 of the 2003 Land Law, as determined by the naturaf resources and r-nvironmcnr :JZf'ney" Article 7. To add Section IIa to Section IT, Part D (gll iding Clause 8, Article 2 of Decree No. 120/20 I O/ND-CP) as follows: "l la, Procedu res for recordi ng and payment of owed land usc levy. I. The recording of owed land use levy for cases specified in Clause 4, Article 15 of Decree No. I9812004/ND-CP (supplemented under Clause 8, Article 2 of Decree No. 120/2010/ ND-CP) shall he carried out as follows: 1.1. Households and individuals eligible to owe land use levy under Clause 8, Article '2 of Decree No. 120/20 1OIND-CP shall fi Ie written requests for land use levy owing together with relevant documents with the land usc right registr.uion offices (or district-level Natural Resources a nd Environment Sect ions ) of district-level People's Committees of localities where their land areas are located. 1.2, Land use right registration offices (or district-level Natural Resources and Environment Sections) shall appraise such requests and propose district-level People's Committees to grant land usc right certificates in which the owed financial obligation (including land use levy) is recorded. Then they shall ruak e cadastral i nf'orrnuti on s l ips and transfer them together wi th a copied dossier set to the same-level tax agency for determining the land use levies to be paid by households or individuals under Item a, Point 1.5 (1.5.2), Clau sc I, Article I of this Circular. and open a register for monitoring the payment of owed land use levies. Such register contains details on land areas within and in excess of the prescribed limit. 2. The payment of owed land use levy shall be made as follows: 2.1. When paying the owed levy, the land IISe1" shall come to the t:IX a2~nc~ make payment declaration. The tax agcncy.saall base itself on the register for monitoringowed land use levies to carry out procedures !oi-h@tiseholds and individuals to pay owed levies. If a household or an individual pays the owed...... levy after five years or cannot fully pq,yJhe owed levy within five years, the levy ~ed with respect to each type of land area, '-"thin or in excess of the prescribed limit, shall b8.00nverted into a percentage (%) of unfu lfil lcei-financinl obligation (being the owed Ievy divi~ by total levy calculated according to the I~rice at the time of grant of the land use righ~tificate) multiplied by the levy re-detennined)ccording to the land price at the time of levy 'Payment. The land price used for lanq.yse levy calculation at the time of levy payri}ent is that prescribed by the provincial-levcl'Peopje's Committee (for land areas withi'l'i'~the land allocation limit) or decided by the ~vincidl­ level People's Committee (for Iasd areas in excess of the limit). 2.2. After the land user fully pa%1he owed levy, the tax agency shall issue a notice or cern Ilcate [() (he land user for the latter to come to the land use right registration office (or district-level Natural Resources and Environment Section) to carry out procedures for having the owed levy deleted in the land use I iglu certi ficate. © VieTNAM LAW & LEGAL fORUM 68 OFFiCiAL GAlEn E Issue nos08·1 O/July 2011 (GongBaD nos 429-430/July 31.2011) 3. Before transferring their land areas, households or individuals permitted to owe land use levies shall fully pay the owed levies. If they are ;lllowed to transfer part of a land plot, the natural resources and environment agency shall carry out procedures to split the land plot for the tax agency to determine the land use levy corresponding to the transferred part. In case ofinheri~land use rights for which the estate leaver has-not yet paid land use levy, the heir is obliged to pay the owed levy under the ililierita~~law." (ExalJIt'ie 3 in an appendix to thi s Circular, notprin~herein) Arti~.Handling of problems in land use levy paytnenr I. In ease a household or an individual has declared-sed submitted a complete and valid dossier~appl ication for a land use right certifica~lora land plot currently in use or for pcrmissjaa for conversion of a land plot currentl~ use for a non-residential purpose to residi,iUial purpose to a competent state agency btjJre March 1, 2011, land use levy shall be ~ected under regulations applicable before tlf!!C:"f"ffective (bte of Decree No r70/ 2010IND-CP. 2. In s.;.ase a household or an individual is permittedto owe land use levy under Clause 4, Article ~~f the Governmqnt's Decree No. 17/ 2006/NIh'CP ofIanuary 77, 700n, it/he/she. will be allowed to pay the owed levy according to the sum recorded in its/his/her certificate. 3. In case a household or an individual is permitted to owe land use levy under Clau~e 1, Article 5 of the Government's Decree No. 84/ 2007/ND-CP of May 25, 2007, it/he/she will beallowed to pay the owed levy under CI ause 8, Article 2 of the Government's Decree No. 120/20 I O/NO-CP, specifically: 3.1. If, within five years from March 1,2011 (effective date of Decree No. 120/20 IO/ND CP), the household or individual comes to a tax agency for declaring and paying the owed levy, it/he/she wi II be allowed to pay it according to the land price at the time of grant of the land usc right certificate. Land usc levies for land areas within and in excess of the limit shall be determined under Item a, Point 1.5 (1.5.2\ Clause 1, Article 1 of this Circular. 3.2. If the household or individual can only fully pay the owed levy after five years or cannot fully pay it within five years, it/he/she/ shall pay the owed levy under Point 2.1, Clause 2, Article 7 of this Circular. Article 9. Organization of irnplementatior 1. Provincial-level People's Committee shall: 1.1. Direct finance and tax agencies and state treasuries to coordinate with related agencies in determining and collecting land lise levie under the guidance in this Circular; 1.2. Examine and handle according to their competence violations and complaints and denunciations related to the determination and collection of land use levies 1.3. Establish a process for coordination among local functional agencies in the transfer of dossiers and determination and collection of land-related financial obligations stipulated ill Cbllse I. Article 1 of this Circular and a process for recording and payment of owed levies stipulated in Article 7 of this Circular to suit the practical srtuation of their localities, clearly deterring time limits and responsibilities of each agency, unit and land user with respect to the C VIETNAM LAW & LEGAL !~?\deJ!Q1i. ~~tO/July 2011 (Cong Baa lJos429-430!July31, 2011) declaratioll, determination aud pelfu) rnance uf financial obligations. 2. This Circular takes effect on August IS. lOLl. Cases ari sing from March I, 2011, shall be dealt with under Decree No. 120/20 1OIND-CP of December 30,2010, and the guidance in this Circular To annul the Ministry of Finance's Circular No. 70!2006ITT-BTC of August 2, 2006, amending and supplementing a number of contents of Circular No. 117/2004rrr~BTC of December 7, 2004. If any problems arising in the course of implementation should be promptly reported to the Ministry of Finance for study and settlement. For the Minister ofFinance Deputy Minister NGUYEN HUU CHI @ VIl;:TNAM lAW a LEGAL fORUM 69