Exemption from agricultural land use tax continued to be granted in Vietnam?

Exemption from agricultural land use tax continued to be granted in Vietnam?

According to point g clause 1 Section 3 Article 1 of Decision 508/QD-TTg in 2022, the strategy to implement tax policy reform for agricultural land use and non-agricultural land use tax until 2030 is as follows:

- Continue to implement agricultural land use tax exemption until the end of 2025 to contribute to the policies and views of the Communist Party and the State on agricultural and rural development.

- Summarize and evaluate the comprehensive situation of the implementation of non-agricultural land use tax policy.

- On that basis, research and improve towards increasing regulation levels on land and supplementing tax collection on houses to encourage efficient use of houses and land, contributing to limiting speculation on houses and land, ensuring reasonable and stable revenue sources for the state budget, in line with Vietnam's socio-economic conditions and international practices.

- At the same time, develop a tax policy towards simplicity, clarity, ease of identifying tax objects, the payable tax amount, in synchronization with the legal provisions on land and related laws.

Thus, according to the tax policy reform strategy, the agricultural land use tax exemption will continue to be implemented until the end of 2025 to contribute to the policies and views of the Communist Party and the State on agricultural and rural development.

Exemption from agricultural land use tax continued to be granted in Vietnam? (Image from the Internet)

What is the application for exemption and reduction of agricultural land use tax in Vietnam?

According to Article 58 of Circular 80/2021/TT-BTC, the application for exemption and reduction of agricultural land use tax includes the following documents:

- For taxpayers facing difficulties due to natural disasters or fires, the tax exemption dossier includes:

+ Proposal documents according to form No. 01/MGTH issued with Appendix I of this Circular.

+ Minutes determining the extent and value of asset damage by the competent authority and certified by the local government at the commune level where the natural disaster or fire occurred according to form No. 02/MGTH issued with Appendix I of this Circular.

+ Financial reports (if an enterprise) with a detailed analysis explaining the determined damage amount and loss due to the damage.

- For taxpayers facing difficulties due to unexpected accidents, the tax exemption dossier includes:

+ Proposal documents according to form No. 01/MGTH issued with Appendix I of this Circular.

+ Documents or minutes confirming the accident with certification from the police authority or certification of the injury level by the medical authority.

+ Documents determining compensation by the insurance authority or a compensation agreement by the one causing the accident (if any).

+ Receipts related directly to accident recovery.

When is agricultural land use tax exempted in Vietnam?

According to Chapter 5 of the Agricultural Land Use Tax Law 1993, cases entitled to agricultural land use tax exemption include:

- Exempting tax for barren hills and mountains used for agricultural and forestry production, protective forest land, and special-use forest land.

- Exempting tax for newly reclaimed land used for production:

+ Annual crops: 5 years; particularly for newly reclaimed land in mountainous areas, swamps, and coastal areas: 7 years;

+ Perennial crops: exempt from tax during the basic construction period and add 3 years from the harvest. For homestead land in mountainous areas, swamps, and coastal areas, add 6 more years.

- For timber trees and perennial crops harvested once, tax is only paid upon exploitation according to the regulations.

- Exempting tax for land used for perennial crops re-cultivated and land currently used for annual crops switched to perennial crops or fruit trees: during the basic construction period and adding 3 years from the harvest.

- Households relocating to new economic areas and reclaiming for agricultural production are exempt from tax as regulated and add 2 years.

- If the newly allocated land is already under agricultural production, it is exempt from tax for 3 years from the land allocation date.

- In case of natural disasters or war causing crop damage, agricultural land use tax is reduced or exempted for each tax-paying household per production season as follows:

+ Damage from 10% to under 20%, reduce tax corresponding to the damage level;

+ Damage from 20% to under 30%, reduce tax by 60%;

+ Damage from 30% to under 40%, reduce tax by 80%;

+ Damage from 40% or more, exempt from 100% tax.

- Exempt or reduce tax for farming households in highland, mountainous, border, and island areas with challenging production and living conditions;

- Exempt or reduce tax for minority farming households with difficult production and living conditions;

- Exempting tax for farming households who are disabled, elderly without support.

- Exempting tax for tax-paying households with war invalids class 1/4 and 2/4, sick soldiers class 1/3 and 2/3;

- Exempting or reducing tax for tax-paying households who are martyr's families;

- Additionally, reduce tax for tax-paying households with war invalids and sick soldiers not entitled to tax exemption.