High tax on people who frequently buy and sell real estate to create fairness?

(NLDO)- When real estate tax is placed in the right place, it can be the economic stick that makes speculators wary.

Tax real estate buyers and sellers very high

Speaking at the group discussion session, 10th session, 15th National Assembly, on November 5 about the draft Law on Personal Income Tax (amended), Professor Hoang Van Cuong ( Hanoi delegation) suggested that it is necessary to impose high taxes on people who regularly buy and sell real estate to limit speculation, instead of applying a general rate of 2% to all transactions as it is now.

Mr. Cuong emphasized that the current tax rate "equating" people who only have one house to live in with people who constantly buy and sell for profit is unreasonable. He gave an example: a person who only owns one house and sells it to move to another place to live must pay 2% personal income tax when selling and an additional 0.5% registration fee when buying a new house. Meanwhile, investors who buy land and "hoard" it, waiting for the price to double or triple, also only pay 2% tax. "It is this group that is the factor that pushes up real estate prices," he said.

According to this delegate, in many countries, people who sell their only home or sell it to buy another place to live are exempt from tax. On the contrary, those who buy land and then resell it in a short period of time, for example, less than a year, will be subject to a very high progressive tax, such as in Korea, which can be up to tens of percent. The goal is to stop speculation, "holding" land waiting for planning to take advantage of the difference.

Therefore, he proposed tax exemption for single home sellers and high tax for those who trade continuously, because now the land database has been digitized, it is possible to clearly identify who is speculator and who is real resident.

When data is insufficient, people suffer first.

Speaking with Nguoi Lao Dong Newspaper, Ms. Vo Nhat Lieu, General Director of Propiin Academy, agreed with the view of limiting speculation, but warned that if implemented hastily, the policy could mistakenly hit people buying houses to live in.

According to her, many people sell their houses not for speculation but because they need money to pay for medical treatment, education for their children or to change to a more suitable place to live. If we only rely on the number of sales or the number of red books in their name to impose high taxes, these people will be considered "speculators".

Currently, real estate ownership data in Vietnam is still incomplete and overlapping, making it difficult to determine exactly who is actually living there and who is leaving the land vacant. "If taxes are imposed without standard data, the real buyers will be the first to suffer," Ms. Lieu commented.

She cited that housing prices in Hanoi and Ho Chi Minh City have increased by more than 50% in 5 years, while the average income of workers is only about 8.3 million VND/month. A 70 m² apartment costs more than 3 billion VND, and people with average income have to work nearly 35 years to buy it. "These people are not speculators, they just want a stable roof," she said.

Taxation should be based on tenure, not house number.

Taxation should be based on holding period.

Ms. Lieu added that according to current regulations, people who only own one house are exempt from personal income tax if they have owned it for more than 6 months and sell the entire house. However, if the apartment does not have a pink book, the seller still has to pay 2% tax even though this is the only asset. On the contrary, real speculators can easily avoid tax by having someone else stand in their name or not transferring the book.

Therefore, she believes that instead of taxing the number of properties, it should be taxed based on the time of holding the property. Specifically, the sooner you sell after buying, the higher the tax; the longer you hold, the lower the tax. For example, if you sell in the first year, you can apply the highest tax to prevent speculation, then gradually reduce it each year. After 5 years, the current tax rate of 2% will still apply.

This calculation, according to her, is completely feasible because the purchase and sale data is already in the notarized contract. Long-term buyers will not be affected, while short-term speculators, who buy and resell within a few months, will have to pay tax costs commensurate with their speculative behavior.

"Anti-speculation is necessary, but policies must be fair," Ms. Lieu emphasized, adding: "Taxes should be a tool to help the market be transparent and protect real buyers, not to make people more afraid when they want to own a place to live."

Source: https://nld.com.vn/danh-thue-cao-nguoi-thuong-xuyen-mua-ban-bat-dong-san-de-tao-su-cong-bang-196251106104722726.htm