Resolution No. 03/2000/NQ-CP On farm economy.

RESOLUTION

On farmstead economy.

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I. ASSESSMENT OF THE SITUATION

Implementing the renewal policy of the Party and State, the household farmer economy has made significant contributions, creating new strength in the development of agriculture and rural economy. Based on the autonomous economy of household farmers, farmsteads with higher capital investment, labor force, technological level, and management have been established, aiming to expand the scale of commodity production, increase productivity, efficiency, and competitiveness under the market mechanism.

Currently, the form of farmstead economy is rapidly increasing in quantity with various economic sectors participating, but mainly still consists of family farmsteads of agricultural households and a considerable proportion of families of retired cadres, workers, civil servants, soldiers, and police officers. Most farmsteads have land sizes below the maximum limit, with diverse origins, primarily using family labor; some hire seasonal and regular labor, with wages agreed upon between both parties. The majority of investments are self-owned and community loans; loans from credit organizations only account for a low percentage. Most farmsteads leverage regional advantages, engage in diversified business operations, and focus on short-term gains to support long-term development.

The development of farmstead economy has contributed to tapping additional resources within the population, expanding unused land, barren hills, and degraded land, especially in midland, mountainous, and coastal areas; creating additional employment opportunities for rural laborers, contributing to poverty reduction; and increasing agricultural products. Some farmsteads have contributed to producing and supplying quality seeds, providing services and technical assistance for product consumption for farmers in their regions.

However, the process of developing farmstead economy raises many issues that need timely resolution.

1. Although the Party and State have had policies promoting the development of farmstead economy, there are still some issues regarding viewpoints and policies that need further clarification, such as: land allocation, leasing, transfer, and accumulation for farmstead economy; labor hiring and utilization; cadres and party members engaging in farmstead economy; registration of activities and income tax for farmsteads... The delayed resolution of these issues has somewhat limited the exploitation of abundant potential in many regions for the development of farmstead economy.

2. Currently, about 30% of farmsteads have not yet been allocated or leased land stably and long-term, so the farmstead owners are not fully confident in investing in production.

3. Most localities with developed farmsteads have not effectively carried out planning for production, irrigation, transportation, electricity, water supply, and communication; the market remains underdeveloped.

4. Most farmstead owners lack knowledge about the market, science and technology, and management, and lack production capital for long-term development, often being at a disadvantage when agricultural product prices fall and facing difficulties in product sales.

II. VIEWPOINTS AND POLICIES FOR DEVELOPING FARMSTEAD ECONOMY

Based on the practical experience of forming and developing farmsteads over time and according to the policies for farmstead economy stated in Resolution No. 4 of the Central Committee's Fourth Plenum (December 1997) and Resolution No. 06 dated November 10, 1998 of the Political Bureau on the development of agriculture and rural areas, it is necessary to address some issues regarding viewpoints and policies to create a more favorable environment and conditions for the robust development of farmstead economy in the future.

1. Unify understanding of the nature and position of farmstead economy:

- Farmstead economy is a form of organized commodity production in agriculture and rural areas, mainly based on households, aimed at expanding the scale and improving the efficiency of production in crop cultivation, animal husbandry, aquaculture, forestry, and linking production with processing and consumption of agricultural, forest, and aquatic products.

- Developing farmstead economy aims to utilize land, capital, technology, and management experience effectively to contribute to sustainable agricultural development; create employment and increase income; encourage wealth creation alongside poverty reduction; reallocate labor and population, and build new rural areas.

- The process of transferring and accumulating farmland to form farmsteads is closely linked to the reassignment of rural labor, gradually shifting agricultural labor to non-agricultural industries, promoting industrialization in agriculture and rural areas.

2. Some long-term policies of the State for farmstead economy

- The State encourages the development and protects farmstead economy. Households and individuals investing in developing farmstead economy will be allocated land, leased land, and granted certificates of land use rights stably and long-term according to the law for production and business purposes.

- The State particularly encourages investment in utilizing and effectively exploiting vacant land, barren hills, and rocky mountains in midland, mountainous, border, and island areas, making full use of degraded lands, ponds, lakes, tidal flats along rivers, coasts, sea bays, and lagoons for specialized agricultural, forestry, and fisheries production with high commercial rates. In narrow land areas with dense populations, encouraging the development of farmsteads that use less land, more labor, intensive farming, and are linked with processing and trade services, producing high-value agricultural products. Priority will be given to allocating and leasing land to agricultural households with capital, production and management experience, who wish to expand the scale of commodity agricultural production, and those without agricultural production land but with a desire to establish a long-term career in agriculture.

- The State consistently implements policies to promote the autonomy of household farmers, develop farmstead economy in conjunction with transforming old cooperatives, expand cooperative and production-business linkage forms among agricultural households, farmsteads, state-owned farms, state enterprises, and other economic sectors to create momentum and comprehensive strength for the development of agriculture and rural areas.

- The State supports farms with capital, science and technology, processing, product consumption, infrastructure construction, and creates favorable conditions for farms to develop sustainably.

- Enhance state management work to ensure that farms develop healthily and effectively.

3. Specific policies.

a) Land policy

- Households with the need and ability to use land to develop farms shall be granted land or leased land by the State and shall be issued certificates of land use rights. The authority to grant land and lease land shall be applied according to the provisions of Decree No. 85/1999/NĐ-CP dated August 28, 1999 of the Government on amending and supplementing certain regulations on granting agricultural land to households and individuals for long-term stable use and Decree No. 163/1999/NĐ-CP dated November 16, 1999 of the Government on granting and leasing forest land to organizations, households, and individuals for long-term stable use for forestry purposes.

Households directly engaged in agriculture, forestry, and aquaculture living in the locality who have the need and ability to use land to expand production shall, in addition to the land allocated within the quota of the locality, be considered for leasing land by the commune people's committee to develop farms.

Non-agricultural households willing and capable of establishing a long-term business from agricultural, forestry, and aquaculture production shall be leased land by the commune people's committee to operate farm economies.

Households and individuals from other localities who wish to establish a long-term business, have investment capital to develop farms, shall be leased land by the commune people's committee where they reside.

The area of land allocated or leased depends on the land fund of the locality and the production and business capacity of the farm owner.

- Households and individuals may acquire the transfer of land use rights, lease or sublease land use rights from organizations, households, and individuals to develop farms in accordance with the provisions of the law. The person acquiring the transfer or lease of land use rights legally has the rights and obligations stipulated by the law on land and shall be issued a certificate of land use rights.

Households and individuals who were allocated or acquired the transfer of land use rights exceeding the land use quota before January 1, 1999 to develop farms shall continue to use it and convert the excess land area to lease according to the provisions of the law on land and shall be issued a certificate of land use rights.

Households and individuals using land but not yet allocated or leased, or having acquired the transfer of land use rights but not yet issued a certificate of land use rights before the issuance of this Resolution, if there is no dispute and the land is used for its intended purpose, shall be considered for allocation or leasing of land and issuance of a certificate of land use rights.

- Provincial People's Committees are responsible for directing the land administration agencies to urgently issue certificates of land use rights so that farm owners can invest confidently in developing production.

b) Tax policy

- To encourage and create conditions for households and individuals to invest in developing farm economies, especially in areas of vacant mountainous hillsides, tidal flats, coastal lagoons, implement tax exemption for farms for a maximum period according to Decree No. 51/1999/NĐ-CP dated July 8, 1999 of the Government on detailed implementation of the Law on Encouraging Domestic Investment (amended) No. 03/1998/QH10.

According to the Corporate Income Tax Law, households and individual farmers producing large-scale goods with high income fall under the category of corporate income tax payers. The Ministry of Finance is instructed to study and submit to the Government for amendments and supplements to Decree No. 30/1998/NĐ-CP dated May 13, 1998 of the Government on detailed implementation of the Corporate Income Tax Law in the direction of defining taxpayers as those households operating farm economies that have been steadily engaged in production and business, have significant commodity value and profit, and reduce the lowest tax rate, aiming to encourage the development of farm economies, which are supported by the public and feasible to implement.

Farms are exempted or reduced from land rental fees according to the provisions of the law on land when renting vacant, mountainous hillsides, degraded land for planting productive forests, perennial crops, and when renting areas in natural water bodies without improvement investments for agricultural, forestry, and fisheries production purposes.

c) Investment and credit policy

- Based on the planning for the development of agricultural, forestry, and fisheries production in areas with difficult socio-economic conditions and extremely difficult conditions, the State has policies to support investment in developing infrastructure such as transportation, irrigation, electricity, drinking water, information, and processing facilities to encourage households and individuals to develop agricultural, forestry, and fisheries production farms.

- Farms developing production and business in fields specified in Article 8, Part I, Chapter II of Decree No. 43/1999/NĐ-CP dated June 29, 1999 of the Government shall borrow funds from the State's investment development support fund, and borrowing of State investment development credit shall be carried out in accordance with the provisions of this Decree.

- Farms developing production and business may borrow commercial credit from state-owned commercial banks. Borrowing shall be carried out in accordance with Decision No. 67/1999/QĐ-TTg dated March 30, 1999 of the Prime Minister on "Some credit policies for agricultural and rural development," and the farm owner may use assets formed from borrowed funds to secure loans in accordance with the provisions of Decree No. 178/1999/NĐ-CP dated December 29, 1999 of the Government on securing loans for credit institutions.

d) Labor policy

- The State encourages and creates conditions to support farmstead owners in expanding their business scale, creating more job opportunities for rural laborers, prioritizing the employment of farmers without land or with insufficient agricultural production land, and households lacking jobs and income. Farmstead owners may hire unlimited numbers of workers; wages shall be agreed upon with workers in accordance with the Labor Law. Farmstead owners must provide protective equipment suitable for each type of work for employees and bear responsibility for them when they encounter risks, accidents, or illness during the term of the labor contract.

- In areas with particularly difficult socio-economic conditions, farmstead owners are given priority in borrowing capital under programs aimed at job creation and poverty reduction to create employment for local laborers; attracting labor from densely populated regions to develop production.

- The State plans to support vocational training for workers employed in farmsteads through various forms of short-term training and upgrading.

d) Science, technology, and environmental policies.

- The Ministry of Agriculture and Rural Development, in collaboration with localities, will plan and implement construction projects for irrigation works to provide water sources for production development. Farmstead owners may self-fund or borrow from state investment credit funds to build water supply systems serving production and daily life within the farmstead. Owners of farmsteads constructing irrigation works and using surface or underground water within the farmstead according to planning shall not pay resource taxes on water.

- The Ministry of Agriculture and Rural Development, in conjunction with provinces and centrally-administered cities, will plan and invest in developing seedling nurseries for agricultural and forestry crops, and breeding facilities (livestock and aquaculture), or support some farmsteads with conditions to produce seeds to ensure sufficient high-quality seeds for distribution to other farmsteads and farming households in the region.

- Encourage farmstead owners to contribute capital to the Fund for Supporting Scientific Development, collaborate with scientific institutions, training centers, and transfer advanced science and technology to apply in farmsteads and provide technical services to farmers in the region.

e) Market policies.

- The Ministry of Industry and Trade, the Ministry of Agriculture and Rural Development, and provincial people's committees shall organize the provision of market information, scientific and technological recommendations, assisting farmsteads in aligning production and business activities with domestic and international market demands.

- The State supports investments in upgrading, expanding, and building new processing facilities in concentrated and specialized areas; guides the signing of contracts for the supply of materials and the sale of agricultural products. Encourage all economic sectors to participate in developing agricultural product processing industries and sales channels for farmsteads and farmers in the area.

- The State encourages the development of rural markets, trading centers for agricultural products and agricultural supplies. Create conditions for farmstead owners to access and participate in domestic and international cooperative programs, trade fairs, and exhibitions.

Promoting the linkage between production, processing, and consumption facilities of various economic sectors, particularly between state-owned enterprises and cooperatives, farm owners, and farmer households.

The State creates favorable conditions and encourages farmstead owners to export their own products directly and those collected from other farmsteads, farming households, and import agricultural supplies.

g) Policies for protecting assets invested by farmsteads.

Legitimate assets and capital investments of farmsteads shall not be nationalized or confiscated through administrative measures. In cases where land allocated or leased to farmsteads needs to be reclaimed due to national defense, security, or national interests, farmstead owners shall be compensated or indemnified at market value at the time of the decision to reclaim the land.

h) Obligations of farmstead owners.

Farmstead owners have the obligation to:

During the production process, they must comply with technical procedures for soil protection and enrichment and other provisions of the Land Law;

Pay taxes and fulfill financial obligations as stipulated by law;

Adhere to laws concerning national defense, security, public order, and social safety;

Fully comply with labor law obligations;

Comply with laws regarding environmental protection, preservation of historical, cultural relics, and scenic spots.

III. IMPLEMENTATION.

1. The Ministry of Agriculture and Rural Development is responsible for guiding localities in planning regions for farmstead economic development; planning the development of irrigation systems and processing industry infrastructure; organizing extension services for agriculture and forestry, and market information systems; guiding industrial enterprises to sign contracts for the sale of agricultural products and raw materials to farmsteads; organizing technical and management training for farmstead owners; annually reporting to the Government on the overall situation of farmstead economics and proposing necessary supplementary or amended policies to promote farmstead economic development.

2. Ministries, agencies equivalent to ministries, and government-affiliated agencies shall guide the implementation of policies within their respective functions and responsibilities as outlined in this Resolution.

3. Provincial People's Committees have the responsibility to:

- Plan regions for expanded farmstead economic development in line with the overall socio-economic development plan of the province; annually publish land use plans approved by competent authorities; announce unused land funds, land available for lease, and publicly list them at the offices of all levels of people's committees for households and individuals to register for leasing and establishing farmsteads.

- Construct infrastructure to serve the development of farmstead economic regions in line with the new era's agricultural and rural development.

- Ensure public order and security in the area to allow residents to feel secure in investing in production development.