No Additional Land Fees Proposed for Businesses Without Fault

The Ho Chi Minh City Real Estate Association (HoREA) has proposed an amendment to the draft resolution of the National Assembly, which outlines mechanisms and policies to address challenges in the implementation of the Land Law. HoREA suggests exempting businesses from additional land-related fees if they are not at fault for delays in land use or rental payments.

According to HoREA, land users are considered faultless if, at the time of the land price decision, there is no official document or ruling from a competent state authority indicating their fault.

However, if such a document or ruling is issued after the decision, land users must pay the additional fees for the period not yet accounted for, along with any late payment charges as per the land law.

HoREA explains that this proposal aims to safeguard the legitimate rights and interests of investors in cases of policy or legal changes.

Furthermore, this regulation is expected to positively impact the investment environment, particularly in attracting foreign direct investment (FDI) in the real estate sector.

HoREA also highlights that, over the years, delays in issuing land price decisions and notifying land use or rental fees for real estate projects, commercial housing, and urban areas have largely been the responsibility of local state authorities.

“In principle, businesses cannot intervene in land pricing processes or planning adjustments, unless there is collusion or corruption, which would be dealt with according to the law,” HoREA emphasizes.

HoREA reports that in Ho Chi Minh City alone, approximately 100 projects are awaiting state authority notifications regarding land use fees, including any potential additional charges.

Additionally, HoREA proposes a mechanism to exclude fault and deduct already paid amounts to prevent unjust treatment of businesses, thereby fostering a more transparent and stable investment environment.

Previously, under Decree 291 issued by the Government, amending certain provisions of Decree 103 on land use and rental fees (effective from November 6), the additional land use fee rate was set at 3.6% per year on the payable land use fee, down from the previously proposed 5.4%.

The calculation period for this fee starts from the onset of the financial obligation until the 8th working day following the land price decision. Decree 291 also allows for the recalculation of additional fees previously paid under Decree 103.