New regulations on land fee collection when changing land use purpose

The Government amends and supplements a number of regulations on land use fee collection when landowners change land use purposes.

Households and individuals changing the land use purpose from non-agricultural production and business land but originating from residential land to residential land of households and individuals do not have to pay land use fees.

The above regulation has just been specified by the Government in Decree No. 123/2017/ND-CP, amending and supplementing a number of articles of Decree No. 45/2014/ND-CP regulating the collection of land use fees and Decree No. 46/2014/ND-CP regulating the collection of land and water surface rents.

The Decree clearly states that if the purpose of land use is changed from non-agricultural production and business land (not residential land) originating from the transfer of residential land from households and individuals to residential land to carry out investment projects from July 1, 2014 onwards, the land use fee must be paid at the difference between the land use fee calculated according to the detailed construction plan of the project approved by the competent state agency minus the land use fee calculated according to the detailed construction plan of the housing construction of the household or individual at the time the competent state agency permits the change of land use purpose.

According to Decree No. 123/2017/ND-CP, if the purpose of land use is changed from non-agricultural production and business land (not residential land) with a long-term stable use period, originating from land allocated by the State with land use fees collected before July 1, 2004, to residential land to implement investment projects from July 1, 2014 onwards, the land use fee must be paid at the difference between the land use fee calculated based on residential land price minus the land use fee calculated based on land price for one-time land rental payment for the entire lease term of non-agricultural production and business land (commerce, services) for a period of 70 years at the time the competent state agency permits the change of land use purpose.

Regarding exemption and reduction of land use fees, Decree No. 123/2017/ND-CP supplements the regulation that economic organizations that are assigned land by the State for non-agricultural production and business with land use fees that have fulfilled their financial obligations regarding land use fees and have been allowed by competent state agencies to be exempted or reduced from land use fees according to the provisions of the land law before July 1, 2014, when transferring projects or transferring land use rights from July 1, 2014 onwards, shall be handled as follows:

- In case of transferring investment projects associated with transferring land use rights:

- In case the exempted or reduced land use fee is not included in the transfer price and the transferee continues to implement the project, the transferee will continue to be exempted or reduced from land use fee according to the provisions of law on investment for the remaining time of the project.

- In case the transferee does not continue to implement the project, he/she must pay land use fees according to the regulations for the project after the transfer. In case the transferor has fulfilled part of the financial obligations regarding the land, the transferee shall inherit the part of the obligations that the transferor has paid.

In the case of land use rights transfer, the transferor must pay the full amount of money that has been exempted or reduced to the state budget according to the land price at the time of land use rights transfer.

According to VnEconomy