Circular No. 10/2018/TT-BTC dated January 30, 2018 of the Ministry of Finance on amending and supplementing a number of Articles of the Circular No. 76/2014/TT-BTC dated June 16, 2014 by Ministry of Finance providing guidance on the Government’s Decree No. 45/2014/ND-CP dated May 15, 2014 on land levy

THE MINISTRY OF FINANCE 

Circular No. 10/2018/TT-BTC dated January 30, 2018 of the Ministry of Finance on amending and supplementing a number of Articles of the Circular No. 76/2014/TT-BTC dated June 16, 2014 by Ministry of Finance providing guidance on the Government’s Decree No. 45/2014/ND-CP dated May 15, 2014 on land levy

Pursuant to the Land Law dated November 29, 2013;

Pursuant to the Government’s Decree No. 45/2014/ND-CP dated May 15, 2014 prescribing the collection of land use levy;

Pursuant to the Government’s Decree No. 135/2016/ND-CP dated September 09, 2016 on amendments and supplements to a number of articles of the Decrees on collection of land levy, land and water surface rents;

Pursuant to the Government’s Decree No. 01/2017/ND-CP dated January 06, 2017 on amendments and supplements to the Decrees providing guidance on implementation of the Land Law;

Pursuant to the Government’s Decree No. 123/2017/ND-CP dated November 14, 2017 on amendments and supplements to a number of articles of the Decrees on collection of land levy, land and water surface rents;

Pursuant to the Government’s Decree No. 87/2017/ND-CP dated July 26, 2017 defining Functions, Tasks, Powers and Organizational Structure of Ministry of Finance;

At the request of the Director of the Department of Public Asset Management,

Minister of Finance promulgates a Circular amending and supplementing a number of Articles of the Circular No. 76/2014/TT-BTC dated June 16, 2014 by Ministry of Finance providing guidance on the Government’s Decree No. 45/2014/ND-CP dated May 15, 2014 on land levy.

Article 1. To add Clause 6 to Article 3:

“6. The percentage (%) used for calculation of annual land rental as prescribed in Clause 3, Clause 4 of this Article shall be determined according to the land use purpose as the land used for commercial and service purpose corresponding to each land area and route, and shall be decided by the Provincial-level People s Committee in accordance with regulations of the Law on collection of land and water surface rents”.

Article 2. To amend Clause 4 and add Clause 5 and Clause 6 to Article 4:

“4. The remaining land use period determined by the formula prescribed in this Article shall be expressed in months if it is shorter than a full year, and considered as 01 month if it is shorter than a month but not shorter than 15 days. Land levy shall not be imposed for the remaining land use period which is shorter than 15 days.

5.If the purpose of the piece of land which is transferred from the household or individual is changed from the non-agricultural land (other than the residential land) to the land for construction of an investment project from July 01, 2014 onwards, the land levy to be paid shall be the difference between the land levy calculated according to the detailed construction plan for the project given approval by the competent authority and the land levy calculated according to the household or individual’s housing construction plan of each region on the date on which the permission for changes in purposes of the piece of land is made by the competent authority.

6.If an economic organization is allowed to change the purpose of the piece of land, which is allocated with payment of land levies, in accordance with regulations in Clause 29 and Clause 30 Article 2 of the Decree No. 01/2017/ND-CP, it must pay the land levy which is the difference between the land levy calculated according to the price of the piece of land after change as prescribed in Clause 1 Article 3 of this Circular over the determined land use term and the land levy calculated according to the price of the piece of land before change over the remaining use term n the date on which the permission for changes in purposes of the piece of land is made by the competent authority."

Article 3. To add Clause 4 to Article 5:

“4. If a household or an individual using the piece of land changes the purpose of the piece of land, which is allocated with payment of land levies, in accordance with regulations in Clause 30 Article 2 of the Decree No. 01/2017/ND-CP, that household or individual must pay the land levy which is the difference between the land levy calculated according to the price of the piece of land after change as prescribed in Clause 1 Article 3 of this Circular over the determined land use term and the land levy calculated according to the price of the piece of land before change over the remaining use term n the date on which the permission for changes in purposes of the piece of land is made by the competent authority."

Article 4. To add Article 8a after Article 8:

“Article 8a. Determination of land levies upon the re-issuance of the Certificate which has been granted inconsistently with the law:

1.When re-issuing the Certificate which has been granted inconsistently with the law as prescribed in Clause 41 Article 2 of the Decree No. 01/2017/ND-CP, the land levy shall be calculated as follows:

a) In case the regulatory authority has issued the Certificate inconsistently with the law regulations, the land levy payable at the time of application for re-issuance of the Certificate shall be determined according to the policies and land prices applicable at the time of issuance of the former Certificate.

b) In case the Certificate has been issued inconsistently with the law regulations due to the mistake of the land user, the land levy payable at the time of application for re-issuance of the Certificate shall be determined according to the policies and land prices applicable at the time of re-issuance.

2.Collection, payment and refund of financial obligations

a) If the land user has not yet paid the land levy when being granted the Certificate or has paid an amount smaller than the determined land levy, the land user is obliged to pay the deficit of land levy.

b) If the land user has paid an amount of land levy higher than the determined amount of land levy payable, the land user shall receive the surplus refunded by the Government as regulated by law.

c) Collection, payment and refund of financial obligations of land users shall be carried out in accordance with the law on land levies, the law on state budget, the law on taxation and relevant laws.”

Article 5. To amend Article 8:

“Article 8. Determination of land levies on residential land allocated ultra vires to households and individuals before July 01, 2004 when such land is recognized (granted the Certificate):

The land levies on residential land allocated ultra vires to households and individuals before July 01, 2004 when such land is recognized (granted the Certificate) shall be determined as prescribed in Article 8 of the Decree No. 45/2014/ND-CP. To be specific:

1.Documentary evidence for payment of land levies to competent authorities as prescribed in Point a and Point b Clause 1 Article 8 of the Decree No. 45/2014/ND-CP shall include:

a) Receipts or invoices for the entitlement to use the land or collect compensation according to the Decision No. 186/HDBT dated 31 May, 1990 of the Council of Ministers on compensation for damage against agricultural land and forest land in case of changes in land use purposes.

b) Receipts or invoices as prescribed in the Circular No. 60/TC-TCT dated July 16, 1993 by the Ministry of Finance providing guidance on management of collection of state-owned house sale, allocation of land for house or building construction.

c) Receipts or invoices or other documentary evidence for payment for using land issued by the People s Committees or any competent authorities in charge of allocating land ultra vires.

2.If the Certificate is granted according to Clause 19 Article 2 of the Decree No. 01/2017/ND-CP, the land levy shall be calculated and paid as per Article 8 of the Decree No. 45/2014/ND-CP”.

Article 6. To add Article 10a to Article 10:

“Article 10a. Collect the land levy when issuing the Certificate in case the land area after re-measurement is greater than the one specified in the Certificate proving the entitlement to use land granted to the land user:

1.If the land user has been granted the Certificate certifying the additional land area as prescribed in Clause 20 Article 2 of the Decree No. 01/2017/ND-CP, the land user shall pay the land levy on the additional land area according to the policies and land price applicable at the date of issuance of the Certificate.  

2.If the Certificate is granted to certify the additional land area as prescribed in Clause 20 Article 2 of the Decree No. 01/2017/ND-CP to the land user who has the document proving the entitlement to use land in accordance with regulations in Article 100 of the Land Law and Article 18 of the Decree No. 43/2014/ND-CP, the land user shall pay the land levy on the additional land area according to the policies and land price applicable at the date on which the decision on recognition of the entitlement to use the additional land area is made by the competent authority”.

Article 7. To add Article 11a after Article 11:

“Article 11a.In case land users who are allocated pieces of land subject to land levies by the State before July 15, 2014 are required to pay the land levy arrears, they must make payments within the time-limits as prescribed in Clause 4 Article 14 of the Decree No. 45/2014/ND-CP”.

Article 8. To amend Clause 1 and Clause 2, and add Clause 3 and Clause 4 to Article 16:

“1. In case the land price is determined according to direct comparison, subtraction, income-based, or surplus-based methods:

a) If the land prices used for calculation of the land levies are announced by competent authorities as regulated by law at the time of application for land levy exemption or reduction, the exempted or reduced amounts of land levies shall be determined according to these land prices.

b) If the land prices used for calculation of land levies determined by competent authorities as regulated by law are not available at the time of application for land levy exemption or reduction:

-The exempted amount of land levy shall be determined according to the land price in the Table of land prices and the land price adjustment coefficient announced by the Provincial-level People s Committee.

-The reduced amount of land levy shall be determined after the land prices used for calculation of land levies are determined and announced by competent authorities.

2.If the land price used for calculation of land levies is determined by adopting the land price adjustment coefficient method, the exempted or reduced amounts of land levies shall be determined according to the land prices in the Table of land prices and the land price adjustment coefficients announced by the Provincial-level People s Committee.

3.The tax agency shall specify the exempted or reduced amount of land levy (which is determined as prescribed in Clause 1 and Clause 2 of this Article) in the Decision on land levy exemption or reduction; and the following statement must be also written: “If the economic organization transfers the piece of land whose area is exempted from or reduced in land levies, the organization must pay the exempted or reduced amount of land levy to the State; the amount of land levies stated in such Decision must be re-calculated as prescribed in regulations of law on the transferred date”.

4.If the user of land which is allocated by the State and subject to land levy is eligible for enjoy land levy exemption but wants to pay the land levy (refuses to enjoy such exemption), the land levy to be paid shall be determined according to policies and land price announced on the date on which the written request for payment of land levy is submitted by the land user. In such cases, the land user shall be entitled to rights as those in case where the land levy is not exempted."

Article 9. To add Clause 7 and Clause 8 to Article 17:

“7. If the land user entitled to defer land levy payment before July 01, 2014 fails to pay the outstanding land levy:

a) If the land user deferred the land levy payment before March 01, 2011, within a period of 5 years from March 01, 2011, the land user shall be entitled to pay the outstanding land levies according to the land price applicable at the time when the certificate proving his/her entitlement to use the land is granted; after the period of 5 years, if the land user fails to fully pay the outstanding land levies, the remaining amount of land levies payable shall be determined according to the policies and land prices applicable at the payment date.

b) If the land user deferred the land levy payment between March 01, 2011 and July 01, 2014, regulations on payment of outstanding land levies in the Decree No. 45/2014/ND-CP shall apply. The land user shall repay the outstanding land levies within the period of 5 years from the date on which the deferral is recorded; after 5 years from the date on which the deferral is recorded, if the land user fails to fully repay the outstanding land levies, the land user shall repay the remaining amount according to the policies and land prices applicable at the time of repayment.

8.If the economic organization that is granted the piece of land by the State in accordance with the Land Law in 1993 and the Land Law in 2003 fails to fulfill all financial obligations regarding the land levy before July 01, 2014, the land levy shall be determined and paid in accordance with regulations in Point a, Point b and Point dd Clause 1 Article 20 of the Decree No. 45/2014/ND-CP.

In case the economic organization has not yet been notified by a competent authority of the land levy payment and has not paid the land levy or has temporarily paid a part of the land levy to the state budget, the temporarily paid amount of land levy (if any) shall be converted into the land levy paid (financial obligations fulfilled) for the land area at the time of actual handover.  For the remaining land area, the land levy shall be paid under the land policies and land price applicable at the time of actual handover of land (if the land area is actually handed over before January 01, 2005, the land price for calculation of land levy shall be the one determined at January 01, 2005), and in this case, the late payment of land levy shall be handled as follows:

-In case the late payment of land levy is due to a subjective cause on the part of the economic organization, it shall pay an amount equivalent to the late land levy payment interest as prescribed by the law on tax administration applicable in each period.

-In case the late payment of land levy is not due to a subjective cause on the part of the economic organization, it needs not pay an amount equivalent to the late land levy payment interest.

The late land levy payment interest shall be calculated from the time of actual handover of land to the time of official notification of payment of land levy into the state budget at a rate of interest for late fulfillment of financial obligations as prescribed by the law in each period”.

Article 10. Effect

1.This Circular takes effect on March 20, 2018.

2.In case where financial obligations arise between the dates of entry into force of the Government s Decree No. 135/2016/ND-CP, the Government s Decree No. 01/2017/ND-CP and the Government s Decree No. 123/2017/ND-CP and the date of entry into force of this Circular, such financial obligations shall be determined in accordance with regulations of the Government s Decree No. 135/2016/ND-CP, the Government s Decree No. 01/2017/ND-CP, the Government s Decree No. 123/2017/ND-CP and this Circular.

3.Any difficulties arising in the course of implementation of this Circular shall promptly reported to the Ministry of Finance for consideration./.

For the Minister

The Deputy Minister

Huynh Quang Hai