Professor Dang Hung Vo: 'There is no book written about taxing second homes'

Former Deputy Minister of Natural Resources and Environment said that there should be no tax on second homes, only tax or not tax on houses.

Conflicting opinions surrounding the proposal to tax real estate speculation were raised at an online discussion with the topic "Two scenarios from taxing second home ownership" on September 7.

A project with hundreds of abandoned villas for many years in Hanoi. Photo: Anh Tu

Professor Dang Hung Vo - former Deputy Minister of Natural Resources and Environment said that in all tax textbooks, there is no book about taxing second homes, only about taxing houses or not taxing houses.If the first or second house is taxed, there must be the same housing unit, because it would be unreasonable if a villa is the first house and not taxed, but the second house that temporarily buys a level 4 house is taxed. Therefore, if there is a tax, there must be a specific tax area unit.

"We are rushing to learn from Singapore in taxing second homes, however, in this country, housing is the same supply, so the government can impose taxes. Some countries tax land, some other countries package both land and houses into one real estate package to tax according to value," said Mr. Vo.

With the same view, Mr. Matthew Powell - Director of Savills HanoiSingapore imposes a second property tax on domestic residents of 3-10% and on foreigners of 10-15%. However, this country introduced a second property tax policy when there were too many immigrants and demand could not meet supply. Meanwhile, in Vietnam, the opposite is true. Supply and demand are developing healthily, while demand is not stable, so it is difficult to apply the theories of other countries to Vietnam.

From another perspective, he said that foreign demand is not high yet, and the number of foreign investors buying houses in Vietnam is not high. "From a business perspective, we think we should not introduce more restrictive policies that reduce foreign investors' interest in Vietnamese real estate," he said.

The Vice President of VNREA said that Australia, Singapore, and the UK tax based on the profits from that land."For example, the annual rental income will be taxed on that value, and if the land is left empty, the tax will be even higher to encourage people to use the land," said Mr. Ha.

Therefore, according to him, to combat speculation, it is necessary to reduce personal income tax in real estate and stipulate that the tax on houses that are bought and sold immediately must be different from houses that are bought and sold after 5 years. In particular, abandoned houses and land, unused land must be taxed highly. As for houses and land for rent, the landlord himself must pay personal income tax when renting, so the housing tax must be reduced.

Also with the view that taxing second homes will kill the rental housing market, heLe Viet Hai, Chairman of the Board of Directors of Hoa Binh Construction Joint Stock Company said.In other countries, if they tax real estate, they tax the first house as well.

"If a person with a house of 1,000 square meters is not taxed while a person with two houses of 50 square meters each is taxed, it would be unreasonable. If we investigate and evaluate each property to tax it, it would be difficult and complicated, so if we tax it, we will not distinguish between the first and second house," said Mr. Hai.

According to VNE