Ho Chi Minh City’s real estate market is experiencing a slowdown in transactions as a significant number of applications for land-use conversion, transfer, and land certificate issuance remain stalled at the tax calculation stage. Buyers are eager to finalize deals but are hesitant due to the delays.
Additionally, many buyers and sellers are facing delays in paying personal income tax, which is necessary for completing ownership transfer procedures.
From August 1 to August 27, the Ho Chi Minh City Tax Department received a total of 8,808 applications. Of these, 346 were for land use charges for recognized land-use rights, 277 for land use charges for change of land-use purpose, 5,448 for personal income tax from real estate transfers, and 2,737 for cases with no financial obligations.
A backlog of land-related documents in Ho Chi Minh City. Photo: HV
For personal income tax applications arising from real estate transfers, where the transfer price declared by the transferring parties is equal to or higher than the land price prescribed by the Provincial People’s Committee at the time of transfer, the tax authority will continue to handle the personal income tax calculation.
However, if the tax authority detects indications of declared transfer prices lower than the land prices prescribed by the Provincial People’s Committee, the tax authority will request the parties to re-declare the transfer prices and consider handling the personal income tax calculation as has been done in previous years.
Recently, Ho Chi Minh City’s departments have proposed that the city strive to issue the “adjusted land price list” within one or two weeks to clear the backlog of 8,808 applications at the tax authority and to apply the adjusted land price list to 11 cases as stipulated in Clause 1, Article 159 of the 2024 Land Law.
Previously, the Ho Chi Minh City Tax Department had repeatedly proposed that the People’s Committee of Ho Chi Minh City soon issue a decision to adjust the land price list and provide specific guidance for the tax authority to implement. However, there seems to be no solution in sight.
Mr. Tran Khanh Quang, CEO of Vietnam An Hoa Real Estate Investment Company, suggested that to unblock the bottleneck related to transfer tax, change of land-use purpose tax, and other real estate-related taxes, the tax authority should apply the old land price list until December 31, 2024, to promptly process people’s dossiers. Afterward, when Ho Chi Minh City has a new land price list, the new list will be applied. This way, there will be no violations, and the people’s interests will not be affected.
On September 10, at a meeting to remove obstacles for Ho Chi Minh City regarding the application of the new land price list, the Ministry of Natural Resources and Environment agreed on the necessity to adjust the city’s land prices.
Currently, the draft adjustment of land prices in the city is being coordinated by the Ho Chi Minh City People’s Committee with the City Council to obtain direct opinions from the City Council members. Dialogues and consultations are being held with agencies, organizations, and land users to gather their opinions. A social criticism conference organized by the Vietnam Fatherland Front Committee of Ho Chi Minh City is also being conducted following the procedure for building legal documents…
At the meeting, delegates agreed on the necessity to adjust Ho Chi Minh City’s land prices, stating that the 2024 Land Law clearly defines the authority to adjust land prices as belonging to the City People’s Committee. The opinions also specifically proposed recommendations to resolve administrative procedures related to financial obligations during the transition period from August 1, 2024.
According to Mr. Duong Ngoc Hai, Vice Chairman of the Ho Chi Minh City People’s Committee, the city considers the adjustment of land prices a significant and complex issue, with a large number of affected subjects and a considerable impact on the local socio-economic development. In this process, Ho Chi Minh City has been very cautious, carefully assessing the impact and fully complying with the prescribed procedures. The city has reported to the City Party Committee’s Standing Committee, and the Standing Committee has concluded and assigned specific tasks to the agencies.
Noting the opinions of Ho Chi Minh City leaders and representatives of ministries, sectors, and associations, Ms. Le Minh Ngan, Deputy Minister of Natural Resources and Environment, said that she would direct the Department of Planning and Land Resources Development to synthesize and complete the report to the Prime Minister. At the same time, she requested the Ho Chi Minh City People’s Committee to closely follow the conclusion of the City Party Committee’s Standing Committee and comply with Decree 71/2024/ND-CP of the Government on land prices, based on the local practical situation, ensuring harmony and not affecting the interests of the people and enterprises.
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