National Assembly Standing Committee approves 30 per cent land rent cut

National Assembly Standing Committee approves 30 per cent land rent cut

At the 43rd session of the Standing Committee of the National Assembly, delegates unanimously approved a decree detailing the implementation of the backdated 2024 land rental reduction bill.

On the morning of March 11, the government sought the Standing Committee’s approval for a 30 per cent reduction in land rental fees for 2024, citing persistent economic difficulties both domestically and internationally.

The measure aims to help businesses to recover while assisting individuals and organisations in localities severely affected by natural disasters and climate change last year.

Deputy Minister of Finance Bui Van Khang stated that the policy is expected to reduce land rental revenues by approximately $160 million, equivalent to the estimated 2023 land rent reduction of 30 per cent nationwide, accounting for about 0.26 per cent of total budget revenue.

"The reduction will not significantly impact overall state budget revenue but will have a substantial effect on the recovery and development of production and business," added Khang. "This will, in turn, boost state budget revenue from taxes, such as personal income tax and corporate income tax, to offset the shortfall caused by the bill."

Deputy Minister of Finance Bui Van Khang at the Standing Committee of the National Assembly's meeting. Photo: National Assembly

The land rental reduction policy was previously implemented from 2020 to 2023. On average, land and water surface rental fees were reduced by approximately $116 million per year.

From 2021 to 2023, the annual reduction increased to $149 million, contributing significantly to supporting businesses, organisations, households, and individuals in resuming production and business after the Covid-19 pandemic.

In a prior review, Phan Van Mai, Chairman of the National Assembly's Economic and Financial Committee, noted that most committee members agreed with continuing the land rental reduction policy in 2024.

"However, since the 2024 fiscal year has already ended, the government’s delayed submission of this proposal to the Standing Committee creates difficulties in collecting, paying, refunding, or imposing penalties for late land rental payments," said Mai.

Mai urged the government to clarify whether this policy would continue in the coming years to avoid repeated procedural delays and redundant administrative processes.

Phan Van Mai, Chairman of the National Assembly's Economic and Financial Committee. Photo: National Assembly

Nguyen Dac Vinh, Chairman of the National Assembly's Committee for Culture, Education, Youth and Adolescents, expressed concern that the 2024 land rental reduction policy was being proposed and implemented in 2025.

"In this regard, the Economic and Financial Committee recommends that the government clarify the impact of the revenue reduction on the state budget, as well as how to address arising issues when implementing the 2024 land rental reduction policy in 2025," added Vinh.

Explaining the delay, deputy minister Khang noted that given the economic difficulties businesses faced in 2024, the government had already extended the deadline for land rental payments until the end of last year.

As a result, most eligible entities had not yet made their payments, meaning the reduction could still be applied without significant obstacles.

"For organisations and businesses that have already made their payments, the reduction will be deducted from their land rental fees for the following year," Khang added. "In this proposal, the government is also seeking approval from the Standing Committee of the National Assembly to proactively implement land rental exemptions and reductions from 2025 onward, based on actual economic conditions."

VIR