Is rural residential land subject to non-agricultural land use tax in Vietnam?

Is rural residential land subject to non-agricultural land use tax in Vietnam?

According to Clause 1, Article 2 of Decree 53/2011/ND-CP stipulating the taxable objects as follows:

Taxable Objects

Taxable objects for non-agricultural land use tax are implemented according to the provisions of Article 2 of the Law on Non-agricultural Land Use Tax. Specifically: as follows:

1. Rural residential land, homestead land in urban areas:

2. Non-agricultural production and business land as specified in Clause 2, Article 2 of the Law on Non-agricultural Land Use Tax, including:

a) Land for industrial zone construction, including land for constructing industrial clusters, industrial zones, export processing zones, and other concentrated production and business areas with the same land use policies;

b) Land for building production and business premises, including land for constructing industrial, handicraft, commercial, service facilities, and other facilities serving production and business (including land for building production and business premises in high-tech parks, economic zones);

c) Land for mineral extraction, land for mineral processing premises, except in cases of mineral extraction that does not affect the topsoil or surface soil;

d) Land for production of construction materials, ceramics, including land for extracting raw materials and land for processing, producing construction materials, ceramics.

3. Non-agricultural land as specified in Article 3 of this Decree used by organizations, households, and individuals for business purposes.

According to the above provisions, homestead land in rural areas is subject to non-agricultural land use tax.

>>> See more: How to calculate annual residential land tax in 2025? How much is the homestead land tax in 2025?

Is rural residential land subject to non-agricultural land use tax in Vietnam? (Image from the Internet)

What is the tax base for non-agricultural land use tax in Vietnam?

According to the provisions in Article 5 of the Law on Non-agricultural Land Use Tax 2010, the basis for calculating non-agricultural land use tax is the tax calculation price and tax rate. Specifically, the tax calculation price and tax rate are determined as follows:

(1) Tax Calculation Price:

The tax calculation price is stipulated in Article 6 of the Law on Non-agricultural Land Use Tax 2010 as amended by Article 249 of the Land Law 2024 as follows:

- The tax calculation price for land is determined by multiplying the taxable land area by the price of 1m^2 of land.

- The taxable land area is stipulated as follows:

+ The taxable land area is the actual land area used.

In the case of having the right to use multiple parcels, the taxable land area is the total area of the taxable parcels.

In cases where the State allocates land or leases land for industrial zone construction, the taxable land area does not include the land area for common infrastructure construction;

+ For homestead land in multi-story housing, apartments, including those for both living and business, the taxable land area is determined by an allocation coefficient multiplied by the floor area of each organization, household, or individual's use.

The allocation coefficient is determined by dividing the land area used for multi-story housing, apartments by the total floor area of the organizations, households, or individuals using them.

In cases where multi-story housing, apartments have basements, 50% of the basement area used by organizations, households, or individuals in the basement is added to their floor area for calculating the allocation coefficient;

+ For underground constructions, an allocation coefficient of 0.5 times the area of the construction site divided by the total construction area of organizations, households, or individuals is applied.

- The price per 1m^2 of land is the land price according to the land price table corresponding to the use purpose and is stabilized every 5 years.

(2) Tax Rate:

The tax rate is stipulated in Article 7 of the Law on Non-agricultural Land Use Tax 2010 as follows:

- The tax rate for homestead land, including usage for business purposes, is applied according to the following progressive tax table:

- The homestead land limit for tax calculation is the new homestead land allocation limit as prescribed by the Provincial People's Committee, centrally-run city, effective from January 1, 2012.

In cases where homestead land had a limit prescribed before January 1, 2012, the application is as follows:

+ If the homestead land limit prescribed before January 1, 2012, is lower than the new homestead land allocation limit, apply the new homestead land allocation limit for tax calculation;

+ If the homestead land limit prescribed before January 1, 2012, is higher than the new homestead land allocation limit, apply the old homestead land limit for tax calculation.

- For multi-story housing, apartments, underground constructions, a tax rate of 0.03% is applied.

- Non-agricultural production and business land is subject to a tax rate of 0.03%.

- Non-agricultural land used for business purposes is subject to a tax rate of 0.03%.

- Land used not in accordance with purposes, or unutilized land, applies a tax rate of 0.15%. In cases where project land is segmented according to the investor's registered investment schedule and approved by the competent state agency, it is not considered unused land and applies a tax rate of 0.03%.

- Encroached land applies a tax rate of 0.2% without applying limits. Tax payment is not the basis for recognizing the lawful land use rights of taxpayers over the encroached land area.

When is non-agricultural land use tax reduced by 50% in Vietnam?

According to Article 10 of the Law on Non-agricultural Land Use Tax 2010, the cases of 50% tax reduction for non-agricultural land use tax are as follows:

- Land of investment projects in encouraged fields; investment projects in areas with difficult socio-economic conditions; land of enterprises that use from 20% to 50% of the workforce as war invalids or sick soldiers;

- Residential land within the limit in areas with difficult socio-economic conditions;

- Residential land within the limit of war invalids ranked 3/4, 4/4; individuals receiving policies as war invalids ranked 3/4, 4/4; sick soldiers ranked 2/3, 3/3; children of martyrs not receiving monthly allowances;

- Taxpayers facing hardships due to force majeure events if the damage value to the land and buildings on the land is from 20% to 50% of the tax calculation value.