Ministry of Finance Guidance on Land Rent and Water Surface Rent

Circular 333/2016/TT-BTC stipulating the determination of the starting price for auctioning leasehold land use rights, specifically:

In the case of auctioning leased land with annual land rent payments: The starting price for auctioning leasehold land use rights with annual land rent payments is the unit price for annual land rent determined by financial authorities based on the land price in the Land Price List, the land price adjustment coefficient, and the percentage (%) rate for calculating the land rent unit price issued by the provincial People's Committee.

The land price adjustment coefficient, percentage (%) rate to determine the starting price according to regulations is the land price adjustment coefficient, percentage (%) rate issued by the provincial People's Committee to determine the land rent unit price in the case of leasing land without auction. If the parcel or land area for auction is in an urban area, commercial center, service hub, transport hub, or a concentrated residential area with special profitability, and advantages in using the land as business, commercial, and service premises, the Department of Finance will report to the provincial People's Committee to decide on adjusting the land price adjustment coefficient and the percentage (%) rate to determine the starting price based on the actual local situation.

Additional regulations on determining land rent

In the case where households and individuals legally transfer agricultural land use rights to implement investment projects compatible with the land use plans approved by the competent state authority, and have to change the land use purpose after receiving the transfer and fulfill financial obligations by paying land rent, the handling of the transferred money will be carried out according to regulations.

In the case where the State leases land with annual rent payments but the financial obligations for several years have been fulfilled due to the deduction of advance compensation and site clearance expenses, or payment for transferred land use rights into the land rent according to the law, when transitioning to one-time payment for the remaining lease period, the land rent payable is determined as follows: The one-time payment land rent unit price for the remaining lease period (after deducting the period for which financial obligations have been fulfilled but not deducted) is determined according to the provisions of Clause 2 Article 4 of Decree No. 46/2014/ND-CP at the time the competent state authority allows switching to one-time payment for the remaining lease period; The land rent payable is calculated by multiplying the area subject to land rent by the unit price of land rent as regulated.

Also according to Circular 333, if the State leases land with annual land rent payments but the financial obligations for several years have been fulfilled due to the deduction of advance compensation and site clearance expenses or payment for transferred land use rights into the land rent according to the law, when transferring the project or transferring assets attached to the land to another person according to the law, the transferee will inherit and continue to be deducted the compensation and site clearance expenses or payment for transferred land use rights proportionate to the remaining time that has not yet been deducted into the payable land rent.

The financial authorities will record the collection and expenditure of the compensation and site clearance expenses that the lessee volunteered to advance, which are deducted from the land rent or water surface rent payable according to the regulations in the state budget law.

Source: Vietstock

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