16:07 (GMT +7) - Saturday 22/09/2018

Society

MoF calls for tax exemptions on farming land

Released at: 15:00, 24/10/2016

MoF calls for tax exemptions on farming land

Photo: Duc Anh

Finance Minister submits proposal to NA on exemptions and reductions in land taxes to spur agricultural development.

by Luong Nhi

Minister of Finance Dinh Tien Dung presented a report on amending Resolution No. 55/2010 on tax reductions and exemptions for farming land to the ongoing second session of the National Assembly (NA).

It proposes tax exemptions on farming land to December 31, 2020. The total value of such exemptions is expected to be VND53.5 billion ($2.3 million) on 93,917 ha of land, with exemptions for households and individuals expected to be VND34.3 billion ($1.5 million). The proposal, if accepted, is to come into effect from January 1, 2017.

The impact on State revenue would be negligible but it would encourage organizations, households and individuals to invest in agriculture and rural areas or expand existing business activities to help farmers improve their living standards and accelerate agricultural restructuring, in particular by enhancing large-scale production to improve the competitive capacity of Vietnamese products, the report said.

Minister Dung said that most farmers receive a tax exemption or a 50 per cent cut to their tax obligations under existing Resolution No. 55. But many owners of farming land must pay tax, including households and individuals that have land exceeding use limits and ownership limits, political and socio-political organizations, and other organizations assigned farming land to use and manage.  

The government wants more people to be subject to farming land tax exemptions or tax reductions to support organizations, households, individuals to invest in agriculture, encourage the development of industrial farming and the application of technology and techniques, and ensure equality among households, organizations and individuals when using farming land.

The government has recommended that tax exemptions be applied to farming land where use and ownership limits are exceeded and to organizations that use agricultural areas.

NA delegates expressed agreement with the recommendation and believe that doing so will support farmers and encourage them to stay on the land rather than heading to urban areas to seek employment.

The NA delegate for Ho Chi Minh City, Mr. Tran Hoang Ngan, said the amended Resolution would be of great importance for farmers, especially given that in the first nine months of this year agricultural production saw slow growth due to global integration and climate change. And the life of a farmer is difficult, he added.

Delegates believe the tax exemptions or reductions would motivate organizations to invest in production and research to improve agricultural products.

There were some concerns expressed, however, that the amendment would create loopholes for foreign businesses because they can collect farming land solely to benefit from the proposed tax exemptions and reductions.

Other NA delegates suggested that the Resolution needs to more comprehensively cover farming issues. For example, the government should issue legal documents punishing individuals and organizations who leave agricultural land fallow or use it for the wrong purpose, which is a waste of national resources.

User comment (0)

Send comment