Circular 333/2016/TT-BTC: Regulations on Land Rent, Water Surface Rent

1. Addition of various regulations on land rent determination

The Circular adds a regulation that in the case of leasing land with annual payments but the compensation amounts, site clearance advances, or land transfer amounts have been deducted from the payable land rent, when switching to one-time land rent payment, the payable land rent is calculated by multiplying the area by the land rent unit price specified in Clause 2, Article 4 of Decree 46/2014/ND-CP.

Conversely, in cases where the land use period is extended, in addition to the land rent, the land user must also pay the land rent for the extended period as prescribed.

The Circular adds a regulation that if the State leases land but the land is not utilized or the land use progress is delayed and the State has not issued a land recovery decision, besides the land rent, the land user must pay an additional land rent amount as prescribed.

2. Amendments and additions to regulations on land rent and water surface rent exemptions and reductions

The Circular adds a regulation that in cases where land is leased with annual payments but the project must be temporarily suspended from July 1, 2015, onwards due to force majeure causes, the land rent is exempted for the suspension period required to remedy the consequences.

The exempted land rent equals the payable land rent if the suspension had not occurred, corresponding to the suspension period. The Circular also adds several cases eligible for land rent exemption or reduction, such as:

- For land leased annually before December 27, 2015, if entitled to land rent exemption or reduction but currently not entitled, the previous exemption or reduction rates still apply.

- Projects disbursing at least 6,000 billion VND within 3 years from the date of the investment registration certificate or investment policy decision are entitled to land rent exemption as prescribed.

- Rural projects utilizing at least 500 laborers are entitled to land rent exemption as prescribed. Additionally, science and technology enterprises, investors leasing land to build and operate infrastructure in industrial zones, export processing zones, or build housing for industrial zone workers are also entitled to land rent exemption as specifically stipulated in the Circular.

3. Amendment of regulations on determining land rent in cases of land rent exemption or reduction

According to the Circular, in cases of one-time land rent payment without auction and land rent exemption, the payable land rent is calculated as follows: Land rent = (Land price for calculating one-time land rent for the entire lease period x Area subject to land rent - Exempted land rent amount - Compensation, site clearance amounts deductible under the law (if any)).

In cases of one-time land rent payment without auction and land rent exemption, the payable land rent is calculated as follows: Payable land rent = (Land price in the Land Price Table / Land type term) x Actual rent payment period x Land price adjustment coefficient x Area subject to land rent - Deductible compensation, site clearance amounts as stipulated (if any).

Circular 333/2016/TT-BTC takes effect from February 10, 2017.

Source: Financial Magazine

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