Proposal to impose high tax on apartments priced over 50 million VND

In the draft law and ordinance for 2024 being completed by the Ministry of Justice to submit to the Government, the Ministry of Finance has proposed to study and develop a general real estate tax law to replace the Law on non-agricultural land use tax and the Law on agricultural land use tax.

Accordingly, the Ministry of Finance proposed to impose low taxes on people using houses of low value and affordable apartments. On the contrary, the Ministry proposed to impose high taxes on luxury apartments (priced at over 50 million VND/m2) and exempt taxes on social housing and workers' housing.

High rental proposal for apartments priced over 50 million VND/m2, image 1 — Illustration photo. (Source: XP)

The taxable price for apartment buildings is the price according to the land use rights transfer contract, house sale and purchase contract or the price according to the price list issued by the Provincial People's Committee.

"To ensure fairness with residential land and individual houses, it is proposed that the tax rate for apartment buildings be applied from the first value, but the tax rate will be lower than for land," the Ministry of Finance proposed.

In addition, the Ministry of Finance proposed to impose high tax rates on houses and land that are encroached upon, abandoned, not yet put into use, or are slow to be put into use according to regulations, or are not used for the right purpose.

Accordingly, the Ministry proposes to apply high tax rates to these types of land (equal to the highest tax rate in the tax schedule currently expected to be applied to residential land).

The Ministry of Finance assesses that the regulation of high tax rates for the above types of houses and land is suitable to the current reality in Vietnam, contributing to limiting land speculation, wasteful land use, and appropriation of public land, further encouraging the economical and effective use of houses and land...

If the draft Law on Real Estate Tax is added to the National Assembly 's 2024 Law and Ordinance Development Program, the Government can submit the draft Law on Real Estate Tax to the National Assembly for comments at the October 2024 session and is expected to pass it at the May 2025 session.

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