What are the bases for calculating non-agricultural land use tax in Vietnam?

What are the bases for calculating non-agricultural land use tax in Vietnam?

Pursuant to Article 5 of the 2010 Law on Non-Agricultural Land Use Tax, the basis for calculating non-agricultural land use tax is the taxable price and the tax rate. To be specific:

(1) Taxable Price (According to Article 6 of the 2010 Law on Non-Agricultural Land Use Tax)

- The taxable price for land is determined by the taxable land area multiplied by the land price per square meter.

- The taxable land area is regulated as follows:

+ The taxable land area is the actual area of land in use.

In case of multiple land parcels for residential purposes, the taxable land area is the total area of the taxable parcels.

In the case where the State allocates or leases land for the construction of industrial zones, the taxable land area does not include the area used for shared infrastructure;

+ For multi-storey residential buildings with multiple households, including those used for both residential and business purposes, the taxable land area is determined by the allocation coefficient multiplied by the area of the house used by each organization, household, or individual.

The allocation coefficient is determined by dividing the construction land area of multi-storey residential buildings by the total house area used by the organizations, households, or individuals.

If multi-storey residential buildings have basements, 50% of the basement area used by organizations, households, or individuals is added to the house area used by these organizations, households, or individuals to calculate the allocation coefficient;

+ For underground construction works, the allocation coefficient is set at 0.5 of the construction land area divided by the total construction area used by the organizations, households, or individuals.

- The price per square meter of land is the price according to the land use purpose as prescribed by the Provincial-level People's Committee and is stable for a 5-year cycle from the date the 2010 Law on Non-Agricultural Land Use Tax takes effect.

(2) Tax Rate (According to Article 7 of the 2010 Law on Non-Agricultural Land Use Tax)

- The tax rate for residential land, including those used for business purposes, is applied according to the progressive tax schedule as follows:

- The residential land area limit used as the tax base is the new residential land allocation limit prescribed by the Provincial-level People's Committee from January 1, 2012.

In case the residential land area limit was prescribed before January 1, 2012, it is applied as follows:

+ If the residential land area limit prescribed before January 1, 2012, is lower than the new residential land allocation limit, the new allocation limit is applied as the tax base;

+ If the residential land area limit prescribed before January 1, 2012, is higher than the new allocation limit, the old residential land area limit is applied as the tax base.

- Residential land in multi-storey buildings with multiple households, apartments, and underground construction works are subject to a tax rate of 0.03%.

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

- Non-agricultural land specified in Article 3 of the 2010 Law on Non-Agricultural Land Use Tax used for business purposes is subject to a tax rate of 0.03%.

- Land used for improper purposes, unused land conforming to the plan is subject to a tax rate of 0.15%. In case of land for phased investment projects according to the investor's registration approved by the competent state agency, it is not considered as unused land and is subject to a tax rate of 0.03%.

- Encroached or occupied land is subject to a tax rate of 0.2% without applying the land area limit. Paying tax is not a basis for recognizing the legal land use rights of taxpayers for the encroached or occupied land area.

What are the bases for calculating non-agricultural land use tax in Vietnam?​ (Image from the Internet)

Are lands used by religious institutions subject to non-agricultural land use tax in Vietnam?

According to Article 3 of the 2010 Law on Non-Agricultural Land Use Tax:

Non-taxable objects

Non-agricultural land used not for business purposes includes:

1. Land used for public purposes, including transportation land, irrigation land; land for construction of cultural, healthcare, education and training, sports facilities serving the public interest; land with historical-cultural relics, scenic spots; land for construction of other public works as prescribed by the Government of Vietnam;

2. Land used by religious institutions;

3. Land for cemeteries and graveyards;

...

Therefore, land used by religious institutions will not be subject to land use tax if it is not used for business purposes.

Are rural residential land and urban residential land subject to non-agricultural land use tax in Vietnam?

Pursuant to Article 2 of the 2010 Law on Non-Agricultural Land Use Tax:

Taxable objects

1. Residential land in rural areas, residential land in urban areas.

2. Non-agricultural production and business land, including land for construction of industrial zones; land used for building production and business establishments; land for mining and processing minerals; land for producing construction materials and pottery.

3. Non-agricultural land specified in Article 3 of this Law used for business purposes.

Therefore, residential land in rural areas and residential land in urban areas will be subject to non-agricultural land use tax.