The City of Ho Chi Minh Proposes to the Prime Minister a Directive to Remove Obstacles in Land Price Calculation

23 August, 2024

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On August 19, Ho Chi Minh City People’s Committee sent a document to the Prime Minister requesting guidance on financial obligations related to land for dossiers after the Land Law 2024 took effect, awaiting the issuance of adjusted land prices as stipulated in Clause 1, Article 257 of the Law.

According to the Ho Chi Minh City People’s Committee, Clause 1, Article 257 of the 2024 Land Law stipulates that the land price table issued by the provincial People’s Committee following the 2024 Land Law will continue to be applied until December 31, 2025. If necessary, the provincial People’s Committee shall decide to adjust the land price table according to this Law to suit the local land price situation.

Before August 1, the land price in Ho Chi Minh City was issued and applied according to Decision No. 02/2020/QD-UBND dated January 16, 2020. The construction of this land price table was limited by the regulations on the land price framework in Point 6, Appendix IX of Decree No. 96/2019/ND-CP dated December 19, 2019.

Specifically, the land price in the price table for special urban areas is limited to a maximum of VND 162 million/m2. Therefore, the land price table of Ho Chi Minh City under the 2013 Land Law in recent years is no longer suitable and does not reflect the actual land price situation in the locality.

Therefore, the Ho Chi Minh City People’s Committee annually submitted to the Municipal People’s Council for approval the land price adjustment coefficient (K coefficient) for each group of subjects, each area with different socio-economic conditions and land use purposes, which has partly resolved the financial obligations related to land in the area.

From August 1 (the effective date of the 2024 Land Law), there is no regulation on the Ho Chi Minh City People’s Committee annually submitting the K coefficient to the Municipal People’s Council for approval as in the 2013 Land Law. Therefore, the land price table applied after August 1 will not apply the 2024 land price adjustment coefficient.

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Ho Chi Minh City People’s Committee believes that it is necessary to amend and adjust the land price table built under the 2013 Land Law (Decision No. 02) to suit the actual land price situation in Ho Chi Minh City and gradually approach the market price, which will be issued from January 1, 2026.

Based on the provisions of Clause 1, Article 257 of the 2024 Land Law, the Ho Chi Minh City People’s Committee has directed the departments, branches, and related units to urgently coordinate in adjusting the land price table as stipulated in Article 17 of Decree No. 71/2024/ND-CP dated June 27, 2024 of the Government on land prices.

Currently, the draft adjustment of the land price table is being coordinated by the Ho Chi Minh City People’s Committee with the Municipal People’s Council to organize a specialized discussion to get direct opinions from the delegates; organize dialogues and consult widely with agencies, organizations, land users, and the social criticism conference held by the Standing Committee of the Vietnam Fatherland Front of Ho Chi Minh City according to the procedure for building legal documents.

However, Ho Chi Minh City is facing difficulties and obstacles in handling administrative procedures related to financial obligations in the transition period from August 1 to the time when the adjusted land price table is issued according to Clause 1, Article 257 of the 2024 Land Law.

Specifically, from August 1, if the unadjusted land price table in Decision No. 02 is applied without multiplying it by the 2024 land price adjustment coefficient, it will not be suitable for the current land price situation in the locality.

If the unadjusted land price table in Decision No. 02 is still applied and multiplied by the 2024 land price adjustment coefficient, there is no guidance on how to implement this.

To avoid congestion in handling dossiers related to financial obligations for land arising in the period from August 1 until the adjusted land price table is issued, the Ho Chi Minh City People’s Committee proposed that the Prime Minister assign the Ministry of Natural Resources and Environment and the Ministry of Finance to guide and resolve the above difficulties and obstacles so that Ho Chi Minh City has a basis for implementation.

Previously, the Ho Chi Minh City Department of Natural Resources and Environment had issued a draft land price table to adjust Decision No. 02 of the Ho Chi Minh City People’s Committee on the land price table in the area. According to this draft land price table, one district and four districts have a land price increase of more than 30 times in some land positions, especially in Hoc Mon district, with a land price increase of up to 51 times.

After the information about the sudden increase in land prices, people in Ho Chi Minh City rushed to do land procedures. However, at present, the tax departments in Ho Chi Minh City only calculate land use levies for dossiers received before July 31. For dossiers submitted after August 1 up to now, the tax agency is still waiting for guidance.

Duy Quang