Decree No. 123/2017/ND-CP Amending and Supplementing Certain Provisions of Decrees on Land Use Fee Collection, Land Rent Collection, and Water Surface Rent Collection

DECREE

Amending and supplementing some articles of the Decreesstipulating the collection of land use fees, land rental fees, and water surface rental fees

------------------------------------------------------------------

Pursuant to the Law on Government Organization dated June 19, 2015;

Pursuant to the Land Law dated November 29, 2013;

Pursuant to the Law on Housing dated November 25, 2014;

Pursuant to the Investment Law dated November 26, 2014;

At the proposal of the Minister of Finance;

The Government issues this Decree amending and supplementing some articles of the Decrees stipulating the collection of land use fees, land rental fees, and water surface rental fees.

Article 1. Scope of Regulation

This Decree amends and supplements some articles of Decree No. 45/2014/NĐ-CP dated May 15, 2014 stipulating the collection of land use fees and Decree No. 46/2014/NĐ-CP dated May 15, 2014 stipulating the collection of land rental fees and water surface rental fees.

Article 2. Amending and supplementing some articles of Decree No. 45/2014/NĐ-CP dated May 15, 2014 stipulating the collection of land use fees

1. Supplementing Point d to Clause 3 of Article 3 as follows:

“d. The adjustment factor for land prices issued by the People's Committee of the province or centrally governed city (hereinafter referred to as the provincial People's Committee) shall be applied from January 1 of each year. The survey date for building the adjustment factor for land prices shall be carried out from October 1 of each year. All costs related to the construction of the adjustment factor for land prices (including consulting fees in case of necessity) shall be funded from the state budget according to the laws on state budget. The selection of organizations to conduct surveys and build the adjustment factor for land prices shall be conducted in accordance with the laws on bidding.

In cases where the provincial People's Committee has not issued the adjustment factor for land prices as prescribed at the time of determining the land use fee, the adjustment factor for land prices issued in the previous year shall be applied to determine the land use fee payable, and the provincial People's Committee shall bear responsibility for any loss of state revenue due to the delay in issuing the adjustment factor for land prices (if any).”

2. Amending Point c of Clause 4, and supplementing Clause 5 to Article 4 as follows:

“c) The unit price for land rental to determine the amount of land rental fee payable under points a and b of this clause shall be determined based on the land price in the Land Price Table according to the purpose of land use in the project, the adjustment factor for land prices for collecting land use fees, and the percentage rate (%) for determining the unit price for land rental according to the commercial and service purposes of land use, as issued by the provincial People's Committee.

5. Procedures and formalities for determining the initial price for auctioning the right to use land for allocating land with the collection of land use fees

a) Procedures and formalities for determining the initial price for auctioning the right to use land in cases where the area subject to land use fees of the plot or land area has a value (calculated based on the land price in the Land Price Table) of VND 30 billion or more for central cities; VND 10 billion or more for mountainous and highland provinces; VND 20 billion or more for other provinces shall be implemented according to the regulations of the Government on land prices and any amendments or supplements thereto (if any), wherein the specific land price shall be determined by the Department of Natural Resources and Environment and transferred to the Land Valuation Council of the locality, chaired by the Department of Finance, for valuation and approval by the provincial People's Committee;

b) Procedures and formalities for determining the initial price for auctioning the right to use land in cases where the area subject to land use fees of the plot or land area has a value (calculated based on the land price in the Land Price Table) of less than VND 30 billion for central cities; less than VND 10 billion for mountainous and highland provinces; less than VND 20 billion for other provinces shall be carried out as follows:

- Within ten days from the date the competent state agency issues the decision on auctioning the right to use land in accordance with the laws on land, the natural resources and environment agency transfers the initial price determination file to the finance agency at the same level for determination of the initial price for auctioning the right to use land. The initial price determination file includes:

+ A request for determination of the initial price from the natural resources and environment agency: one original copy;

+ The decision on auctioning the right to use land approved by the competent state agency: one copy;

+ Land registry information (area, location, purpose of land use, form of land lease, duration of land use...): one copy.

- Within ten days from the date of receipt of the initial price determination file for auctioning the right to use land transferred by the natural resources and environment agency, the finance agency determines the initial price in accordance with the laws on land use fee collection and submits it for approval by the competent state agency (the provincial People's Committee or the agency authorized to delegate authority) in accordance with the regulations.

If there is insufficient basis to determine the initial price, within five working days from the date of receipt of the file, the finance agency must notify the natural resources and environment agency in writing to provide additional information. After receiving all necessary files, the completion period is ten days from the date of receipt of the supplementary files.

- Based on the decision approving the initial price by the competent state agency, the entity responsible for auctioning the right to use land shall organize the auction in accordance with the laws.

The procedures for re-determining the initial price shall be carried out as prescribed for the first determination of the initial price.

c) Procedures and formalities for determining the initial price for auctioning the right to use land attached to state-owned assets shall be carried out in accordance with the laws on the management and use of public assets.”

3. Amending Clause 3, and supplementing Clause 4 to Article 5 as follows:

“3. For the change of land use purpose from non-agricultural production and business land (not residential land) acquired through transfer of residential land from households or individuals to residential land for implementing investment projects from July 1, 2014 onwards, the land use fee shall be paid at the difference between the land use fee calculated according to the detailed construction plan of the project approved by the competent state agency minus the land use fee calculated according to the detailed construction plan for residential buildings of households or individuals at the time they were permitted by the competent state agency to change the land use purpose.”

In the case where a household or individual changes the purpose of land use from non-agricultural production and business land (not residential land) with its origin being residential land to residential land for the household or individual, they are not required to pay land use fees.

4. Changing the purpose of use from non-agricultural production and business land (not residential land) with a stable long-term usage period, which has been granted by the State with payment of land use fees before July 1, 2004, to residential land to implement investment projects from July 1, 2014 onwards shall require payment of land use fees equal to the difference between the land use fee calculated based on the residential land price minus (-) the land use fee calculated based on the price of land subject to one-time payment of rent for the entire lease period of 70 years of non-agricultural production and business land (commercial, service) at the time when the competent state agency permits the change of land use purpose.

4. Amend Article 9 as follows:

"Article 9. Payment of land use fees when recognizing land use rights (issuing Certificate of Land Use Rights) for households and individuals for residential land with origins of being granted beyond authority or violating land laws from July 1, 2004 to before July 1, 2014, but now recognized by the State to issue Certificates of Land Use Rights.

1. Households and individuals using land with origins of violating land laws as stipulated in Article 22 of Decree No. 43/2014/ND-CP dated May 15, 2014 of the Government detailing implementation of certain provisions of the Land Law (hereinafter referred to as Decree No. 43/2014/ND-CP) or land granted or leased beyond authority from July 1, 2004 to before July 1, 2014, but now conforming to land use planning, if the competent state agency issues Certificates of Land Use Rights according to Clause 9, Article 210 of the Land Law, then they must pay 100% of the land use fees based on the land price specified in Points b and c, Clause 3, Article 3 of this Decree at the time of the decision recognizing land use rights by the competent state agency. If there is proof of payment for land use as prescribed, the amount paid can be deducted from the land use fees payable; the deduction amount shall not exceed the land use fees payable.

2. In cases where land is used for construction works that are not residential buildings, if issued Certificates of Land Use Rights for non-agricultural production and business land in the form of land grant with payment of land use fees for a long-term usage period, then they must pay 100% of the land use fees based on the land price specified in Points b and c, Clause 3, Article 3 of this Decree for the highest usage period of non-agricultural production and business land as stipulated in Clause 3, Article 126 of the Land Law at the time of the decision recognizing land use rights by the competent state agency."

5. Supplement Clause 10 to Article 10 as follows:

"10. Economic organizations that have been granted non-agricultural production and business land with payment of land use fees by the State, having completed their financial obligations regarding land use fees and received decisions from competent state agencies allowing exemption or reduction of land use fees according to land laws before July 1, 2014, when transferring projects or transferring land use rights from July 1, 2014 onwards, shall be handled as follows:

a) For cases involving the transfer of investment projects tied to the transfer of land use rights:

- In cases where the exempted or reduced land use fees are not included in the transfer price and the transferee continues to implement the project, the transferee will continue to enjoy exemptions or reductions of land use fees according to investment laws for the remaining period of the project.

- In cases where the transferee does not continue to implement the project, they must pay land use fees according to regulations for the project after the transfer. If the transferor has already fulfilled part of their financial obligations regarding land, the transferee may inherit the portion of the obligations that the transferor has paid.

b) For cases involving the transfer of land use rights, the transferor must pay the full amount of the exempted or reduced fees into the state budget according to the land price at the time of the transfer of land use rights."

6. Supplement Article 13a as follows:

"Article 13a. Procedures and formalities for exemption or reduction of land use fees for social housing projects and infrastructure investment projects for cemeteries and graveyards

1. Within 20 days from the date of the decision on land allocation by the competent state agency according to land laws, the land user submits the application for exemption or reduction of land use fees to the tax authority directly responsible for collection or to the agency receiving administrative procedures related to land use as stipulated in Decree No. 43/2014/ND-CP. In cases where the application for exemption or reduction of land use fees is submitted to the agency receiving administrative procedures related to land use, the transfer to the tax authority shall follow the legal procedures and formalities for receiving and circulating files to determine the financial obligations of the land user.

2. Within 20 days from the date of receipt of complete and valid files as stipulated in Clause 3 of this Article, the tax authority determines and issues a decision on exemption or reduction of land use fees according to regulations or notifies that exemption or reduction of land use fees is not granted due to non-compliance with conditions.

3. Files for exemption or reduction of land use fees for social housing projects and infrastructure investment projects for cemeteries and graveyards

a) Files for exemption of land use fees for social housing projects invested in accordance with Clause 1, Article 53 of the Housing Law 2014

- A request for exemption of land use fees (specifying the area of land allocated and the reasons for exemption of land use fees): One original copy;

- Decision or approval document for the social housing project investment from the competent state agency: One copy;

- Decision on land allocation from the competent state agency: One copy.

b) Files for exemption of land use fees for social housing projects invested in accordance with Clause 2, Article 53 of the Housing Law 2014

- A request for exemption of land use fees (specifying the area of land allocated and the reasons for exemption of land use fees): One original copy;

- Decision or approval document for the social housing project investment from the competent state agency: One copy;

- Decision on land allocation from the competent state agency: One copy;

- A list of workers of the enterprise or cooperative allocated housing with confirmation from the competent state agency as prescribed by housing laws: 01 copy;

- The enterprise's or cooperative's commitment regarding the rental price not exceeding the rental price set by the provincial People's Committee according to housing laws, confirmed by the competent state agency: 01 original;

c) Documents for exemption from land use fee for social housing projects invested in accordance with Clause 3, Article 53 of the Housing Law 2014:

- A request for exemption from land use fee (specifying the legal residential land area and the reasons for the exemption): 01 original;

- Decision or investment approval document for building social housing issued by the competent state agency: 01 copy;

- Land-related documents as prescribed by land laws certifying the legal residential land area for investment in social housing construction: 01 copy.

d) Documents for exemption or reduction of land use fee for infrastructure projects of cemeteries or burial grounds:

- Request for exemption or reduction of land use fee (specifying the land area allocated and the reasons for the exemption or reduction): 01 original;

- Investment Certificate or Investment License or Registration Certificate of Investment or Decision on Investment Orientation (except in cases where such certificates/licenses are not required under investment laws): 01 copy;

- Approved investment project in accordance with investment laws (except in cases where Investment Certificates, Licenses, Registration Certificates, or Investment Orientation Decisions are required under investment laws): 01 copy;

- Decision approving the investment project as prescribed by law: 01 copy;

- Decision allocating land by the competent state agency: 01 copy.”

7. Amend Clause 5 of Article 14 as follows:

“5. In case the basis for calculating the land use fee changes, the tax authority must re-determine the land use fee payable and notify the person responsible for payment.

If the land user has completed financial obligations related to the land use fee and requests adjustment of the detailed construction plan leading to additional financial obligations for land use (if any), they must pay the additional land use fee into the State budget.

If the land user has not completed financial obligations related to the land use fee and requests adjustment of the detailed plan leading to additional financial obligations for land use (if any), the land user must:

- Pay the full amount of the land use fee determined based on the detailed construction plan before adjustment plus any late payment fees as prescribed by law;

- Pay the additional land use fee equal to the difference between the land use fee payable before and after the adjustment at the same time point approved by the competent state agency for the plan adjustment (if any).”

8. Add Article 14a and Article 14b as follows:

“Article 14a. Procedures and formalities for refunding or offsetting paid land use fee or transferred land use rights payment against the developer’s financial obligation for social housing projects

1. The developer of a social housing project submits a request for refunding or offsetting the paid land use fee or transferred land use rights payment against their financial obligation to the Department of Finance at the location of the project implementation.

2. Documents for refunding or offsetting the paid land use fee or transferred land use rights payment when implementing a social housing project

a) For social housing projects invested in accordance with Clause 1, Article 53 of the Housing Law 2014

- Request for refunding or offsetting: 01 original;

- Decision or approval document for the investment project to build social housing issued by the competent state agency: 01 copy.

- Contract or document transferring land use rights in accordance with the law at the time of transfer: 01 copy;

- Documents or invoices proving the payment of money into the State budget when the State allocates land or leases land, or documents or receipts showing the receipt of land use rights transfer from other organizations, households, or individuals, where that land area is used for social housing construction: 01 copy.

b) For social housing projects invested in accordance with Clause 2, Article 53 of the Housing Law 2014

- Request for refunding or offsetting: 01 original;

- Decision or approval document for the social housing project investment from the competent state agency: One copy;

- A list of workers of the enterprise or cooperative allocated housing with confirmation from the competent state agency as prescribed by housing laws: 01 copy;

- Contract or document transferring land use rights in accordance with the law at the time of transfer: 01 copy;

- Documents or invoices proving the payment of money into the State budget when the State allocates land or leases land, or documents or receipts showing the receipt of land use rights transfer from other organizations, households, or individuals, where that land area is used for social housing construction: 01 copy.

3. Time limit for processing the refunding or offsetting of the paid land use fee or transferred land use rights payment.

a) Within a maximum period of 20 days from the date of receiving complete and valid documents from the developer as stipulated in Clause 2 of this Article, the Department of Finance shall determine and report to the provincial People's Committee for consideration and decision on the refunding or offsetting of the paid land use fee or transferred land use rights payment against the developer’s financial obligation for the social housing project;

b) Within a maximum period of 10 days from the date the provincial People's Committee approves the refunding or offsetting of the paid land use fee or transferred land use rights payment against the developer’s financial obligation for the social housing project, the Department of Finance shall issue a document to the local Tax Office and National Treasury to implement it.

Article 14b. Procedure and formalities for determining the land use fee payable when a purchaser or lessee of social housing sells or transfers the property.

1. A purchaser or lessee of social housing who wishes to resell social housing shall submit a written request and the documents specified in Clause 2 of this Article to the Land Registration Office.

2. The documents required to determine the land use fee payable upon sale of social housing include the following:

a) A written request from the purchaser or lessee of social housing requesting determination of the land use fee payable upon sale of social housing: 01 original copy.

b) The social housing purchase contract: 01 copy.

c) Certificate of land use rights, ownership of housing and other assets attached to the land as prescribed by laws on land (if applicable) or the documents and files related to the purchase of social housing as prescribed by laws on social housing: 01 copy.

3. The Land Registration Office shall prepare a Transfer Information Form to determine the financial obligation regarding land for submission to the tax authority responsible for direct collection, along with the documents submitted by the purchaser or lessee of social housing as stipulated in Clause 2 of this Article, to determine the land use fee payable upon sale or transfer of social housing.

The Transfer Information Form to determine the financial obligation regarding land for purchasers or lessees of social housing shall comply with the provisions of laws on documents and procedures for receiving and circulating documents to determine the financial obligation regarding land for land users.

4. Within a maximum period of twenty days from the date of receipt of complete and valid documents, the tax authority shall determine the amount of the land use fee payable according to the provisions of laws on the sale of social housing. Issuance of the Notice to Pay the Land Use Fee and collection of the land use fee shall be carried out in accordance with the provisions of laws."

9. Amend Clause 2 and Clause 3 of Article 15 as follows:

“2. In cases where the State grants land without using the auction method for land use rights and the entity voluntarily pays compensation and clearance costs in advance according to the plan approved by the competent state agency, such advance payment may be deducted from the land use fee payable according to the approved plan; the deduction amount shall not exceed the land use fee payable. Any remaining compensation and clearance costs that have not been deducted from the land use fee payable (if any) shall be included in the project's investment capital.

Documents for requesting deduction of compensation and clearance costs include:

- The compensation and clearance plan approved by the competent state agency: 01 copy;

- Payment vouchers and detailed lists of compensation and clearance payments: 01 original copy.

3. In cases where a project granted land by the State without using the auction method has a mixed land use form: grant land with payment of land use fee, grant land without payment of land use fee, lease land, and the investor voluntarily pays compensation and clearance costs in advance according to the plan approved by the competent state agency, the deduction of compensation and clearance costs shall be calculated based on each type of area and evenly distributed among the areas corresponding to public purposes.

10. The Minister of Finance shall provide specific guidance on this Article.

Article 3. Amending and supplementing some articles of Decree No. 46/2014/NĐ-CP dated May 15, 2014 on land rent payment and water surface rent collection

1. Amend Point a Clause 4, Clause 5 and Clause 6 Article 4 as follows:

“4. The specific land price shall be determined according to the direct comparison, residual, income, and adjustment factor methods prescribed in the Government’s Decree on land prices applicable in the following cases:

a) Determining the unit price for annual land rent for the first stable rental period for the case of leasing land for commercial trade, service, real estate, mineral exploitation purposes; determining the unit price for lump-sum land rent for the entire lease period without going through auction procedures; determining the unit price for annual land rent and lump-sum land rent for the entire lease period when transferring from annual land rent to lump-sum land rent for the entire lease period as stipulated in Clause 2 Article 172 of the Land Law; determining the unit price for annual land rent and lump-sum land rent for the entire lease period when transferring movable property attached to leased land as stipulated in Clause 3 Article 189 of the Land Law; determining the unit price for annual land rent and lump-sum land rent for the entire lease period when state-owned enterprises are equitized in cases where the area subject to land rent payment of the plot or area has a value (calculated based on the land price in the Land Price Table) of VND 30 billion or more for central cities; VND 10 billion or more for mountainous and highland provinces; VND 20 billion or more for other provinces.

5. The specific land price shall be determined according to the adjustment factor method prescribed in the Government’s Decree on land prices applicable in the following cases:

a) Determining the unit price for annual land rent for the case of leasing land for commercial trade, service, real estate, mineral exploitation purposes; determining the unit price for lump-sum land rent for the entire lease period without going through auction procedures; determining the unit price for annual land rent and lump-sum land rent for the entire lease period when transferring from annual land rent to lump-sum land rent for the entire lease period as stipulated in Clause 2 Article 172 of the Land Law; determining the unit price for annual land rent and lump-sum land rent for the entire lease period when transferring movable property attached to leased land as stipulated in Clause 3 Article 189 of the Land Law; determining the unit price for annual land rent and lump-sum land rent for the entire lease period when state-owned enterprises are equitized in cases where the area subject to land rent payment of the plot or area has a value (calculated based on the land price in the Land Price Table) under VND 30 billion for central cities; under VND 10 billion for mountainous and highland provinces; under VND 20 billion for other provinces;

b) Determining the unit price for annual land rent for the subsequent stable period for plots or areas leased by the State for commercial trade, service, real estate, mineral exploitation purposes with a value (calculated based on the land price in the Land Price Table) of VND 30 billion or more for central cities; VND 10 billion or more for mountainous and highland provinces; VND 20 billion or more for other provinces;

c) Determining the unit price for annual land rent (excluding the case of leasing land for commercial trade, service, real estate, mineral exploitation purposes);

d) Determining the starting price for auctioning the right to use land for leasing under the annual land rent payment form.

Annually, the People's Committee of the province shall specify the adjustment factor for land prices to apply to the cases provided for in this clause.

The adjustment factor for land prices issued by the People's Committee of the province shall take effect from January 1 each year. The survey time for building the adjustment factor for land prices shall be carried out from October 1 each year. Costs related to building the adjustment factor for land prices to calculate land rent (including consulting fees in case of necessity) shall be covered from the state budget in accordance with the laws on state budget. The selection of organizations to conduct surveys and build the adjustment factor for land prices shall be carried out in accordance with the laws on bidding.

In the event that the People's Committee of the province has not yet issued the adjustment factor for land prices as prescribed at the time of determining the unit price for land rent or adjusting the unit price for land rent, the adjustment factor for land prices issued in the previous year shall be applied to determine the amount of land rent payable, and the People's Committee of the province shall bear responsibility for any loss of state revenue due to the delay in issuing the adjustment factor for land prices (if any).”

6. Procedures and formalities for determining the starting price for auctioning the right to use land for leasing land and water surface

a) Procedures and formalities for determining the starting price for auctioning the right to use land for the case of auctioning the right to use land where the area subject to land rent and water surface rent payment of the plot or area has a value (calculated based on the land price in the Land Price Table) of VND 30 billion or more for central cities; VND 10 billion or more for mountainous and highland provinces; VND 20 billion or more for other provinces shall be implemented in accordance with the Government’s Decree on land prices and any amendments and supplements thereto (if any); in which the specific land price shall be determined by the Department of Natural Resources and Environment and transferred to the local Land Price Appraisal Board chaired by the Department of Finance to organize the appraisal and submit to the People's Committee of the province for approval;

b) Procedures and formalities for determining the starting price for auctioning the right to use land for the case of auctioning the right to use land where the area subject to land rent and water surface rent payment of the plot or area has a value (calculated based on the land price in the Land Price Table) under VND 30 billion for central cities; under VND 10 billion for mountainous and highland provinces; under VND 20 billion for other provinces shall be carried out as follows:

- Within ten days from the date the competent state agency issues the decision on auctioning the right to use land in accordance with the laws on land, the natural resources and environment agency transfers the initial price determination file to the finance agency at the same level for determination of the initial price for auctioning the right to use land. The initial price determination file includes:

+ A request for determination of the initial price from the natural resources and environment agency: one original copy;

+ The decision on auctioning the right to use land approved by the competent state agency: one copy;

+ Land registry file (information on area, location, purpose of land use, form of land lease, lease term, water surface lease...): 01 copy.

- Within ten days from the date of receiving the file to determine the initial price for auctioning the right to use land transferred by the natural resources and environment authority, the financial agency shall determine the initial price in accordance with the provisions of the law on collecting land rental fees and water surface rental fees, and submit it for approval by the competent state authority (the provincial People's Committee or the state agency authorized or delegated) in accordance with the regulations.

If there is insufficient basis to determine the initial price, within five working days from the date of receipt of the file, the finance agency must notify the natural resources and environment agency in writing to provide additional information. After receiving all necessary files, the completion period is ten days from the date of receipt of the supplementary files.

- Based on the decision approving the initial price by the competent state agency, the entity responsible for auctioning the right to use land shall organize the auction in accordance with the laws.

The procedures for re-determining the initial price shall be carried out as prescribed for the first determination of the initial price.

c) Procedures and formalities for determining the initial price for auctioning the right to use land attached to state-owned assets shall be carried out in accordance with the laws on the management and use of public assets.”

3. Amend Article 9 as follows:

“3. The State leases water surfaces (seas) for exploration and exploitation activities of oil and gas. Contractors pay water surface rental fees (sea surface rental fees) in accordance with the provisions of the law except where there are separate commitments made by the Government of Vietnam with foreign governments or organizations under signed agreements. Sea surface rental fees are defined as follows:

a) The unit price for leasing sea surface for oil and gas exploitation activities shall be applied at the maximum level within the framework of the water surface rental fee prices stipulated in Clause 1 of this Article and shall remain stable for five years in accordance with Clause 2 of Article 14 of this Decree or according to separate commitments made by the Government of Vietnam with foreign governments (or organizations) under signed agreements. The area for calculating sea surface rental fees is the area allocated for oil and gas exploitation in accordance with the law;

b) The unit price for collecting sea surface rental fees for exploration activities shall be fifty percent of the unit price for collecting sea surface rental fees for oil and gas exploitation activities. The collection of sea surface rental fees for exploration activities shall be carried out during the exploration period and correspond to the scope of the sea surface area explored each time;

c) The time for collecting water surface rental fees (sea surface rental fees) shall be calculated from the date when the water surface is assigned for exploration and exploitation of oil and gas.”

3. Amend Clause 5, Clause 6, and supplement Clause 6a, Clause 7a, and Clause 8a to Article 12 as follows:

“5. In cases where land is simultaneously used for purposes requiring payment of land rental fees and purposes not requiring payment of land rental fees, the amount of land rental fees payable shall be determined based on the allocation of areas according to the purpose of land use.

In cases where entities are granted land leases by the State in accordance with the law on land management and are using houses and land at construction projects with mixed purposes that belong to the state or have parts under the management of the State but cannot be separately allocated for each user, the amount of land rental fees payable by the lessee shall be determined based on the allocation coefficient based on the usable floor area.

6. In cases where entities are granted land leases with full payment of land rental fees for the entire lease period and have paid the land rental fees in accordance with the law or legally acquired the right to use land through transfer and then must switch to leasing if the investor requests adjustments to the detailed construction planning which generate additional land-related financial obligations (if any), they must pay additional land rental fees into the state budget.

In cases where the obligation to pay land rental fees has not been completed and the land user requests adjustments to the detailed construction planning which generate additional land-related financial obligations (if any), the land user must:

- Pay the full amount of land rental fees determined according to the detailed construction planning before adjustment plus late payment penalties as prescribed by law.

- Pay additional land rental fees equal to the difference between the land rental fees payable according to the planning before adjustment and after adjustment determined at the same time when the competent state authority permits the adjustment of the planning (if any).

6a. In cases where public service units are granted annual land leases and the plot of land or the area subject to land rental fees has a value (based on the land price in the Land Price Table) of VND 30 billion or more for central cities; VND 10 billion or more for mountainous and highland provinces; VND 20 billion or more for other provinces when implementing investment construction projects according to detailed construction planning approved by the competent state authority on leased land (without changing the land use purpose) and the land use coefficient (building density, height of buildings) is higher than the current land use coefficient before the implementation of the project, the Provincial People's Committee shall decide to adjust the land price adjustment factor to calculate land rental fees.

7a. Public service units granted land without payment of land use fees or land leases may be exempted from paying land rental fees for the entire lease period if they use part or all of the land area, part or all of the building area for production, business, services, leasing, joint ventures, or joint operations in accordance with the law on the management and use of state assets. They must pay land rental fees as follows:

a) In cases where the entire land area granted by the State for leasing or attached assets are used for production, business services, leasing, joint ventures, or joint operations, the land rental fees shall be determined as in the case of economic organizations granted land leases for production and business;

b) In cases where part of the land area or attached assets are used for production, business services, leasing, joint ventures, or joint operations, the amount of land rental fees payable shall be determined based on the land price in the Land Price Table, the percentage rate for the unit price of land rental fees, the land price adjustment factor issued by the Provincial People's Committee, and the percentage rate of the land area or building area (usable floor area) used for production, business services, leasing, joint ventures, or joint operations;

c) In cases where the provisions of point b of this clause cannot be separately allocated for the area serving production, business, services, leasing, joint ventures, or joint operations, the amount of land rental fees payable shall be determined based on the allocation coefficient. The allocation coefficient shall be determined by the ratio of revenue from production, business services, leasing, joint ventures, or joint operations to the total projected income of the public service unit approved by the competent state authority in accordance with the law.

8a. Organizations and individuals who are leased land by the State to pay annual land rent for implementing investment production and business projects voluntarily return the land due to no longer needing it, but if the competent state authority delays issuing the decision to recover the land, they are not required to pay the land rent from the date of submitting the request to return the land until the date when the competent state authority issues the decision to recover the land in accordance with the laws on land. Organizations and individuals must fully fulfill their financial obligations regarding the land rent (including late payment fees if any) up to the date of submitting the voluntary request to return the land in accordance with the laws on land.

4. Amend Clause 2 and supplement Clause 3a to Article 13 as follows:

“2. In cases where land leasing does not go through public auction and the entity receiving land lease from the State voluntarily pays advance compensation and clearance costs according to the plan approved by the competent state authority, the amount paid in advance can be deducted from the land rent payable according to the approved plan; the deduction amount shall not exceed the amount of land rent payable. For the remaining compensation and clearance costs that have not been deducted from the land rent payable (if any), they will be included in the project's investment capital.

Documents for requesting deduction of compensation and clearance costs include:

- The compensation and clearance plan approved by the competent state agency: 01 copy;

- Payment vouchers and detailed lists of compensation and clearance payments: 01 original copy.

3a. In cases where the State recovers land, implements compensation and clearance, and leases land annually according to the provisions of the law but cannot balance the state budget to implement compensation and clearance, the Department of Finance reports to the provincial People's Committee for consideration and decision on the lessee voluntarily paying the advance land rent corresponding to the compensation and clearance costs according to the plan approved by the competent state authority. The tax authority converts this amount into the number of years and months to complete the annual land rent payment obligation and notifies the lessee; the deduction amount shall not exceed the amount of land rent payable.

5. Amend Clause 2 of Article 17 as follows:

“2. When the land use period is extended, the land rent for entities required to pay land rent is determined based on the policy and land price at the time of extension.

For cases of annual land rent, the stable unit price of land rent is calculated from the date the competent state authority issues the decision to extend the land lease period. If the end of the lease period occurs before the competent state authority issues the decision to extend the lease period, the land user must pay the annual land rent for this period based on the unit price determined based on the land price in the Land Price Table, land price adjustment coefficient, and percentage rate (%) for calculating the land rent unit price issued by the provincial People's Committee.

6. Amend Clause 7 and supplement Clauses 9 and 10 to Article 18 as follows:

“7. In cases where the competent state authorities discover that land users who have been exempted or reduced from land rent and water surface rent do not meet the conditions for exemption or reduction of land rent due to reasons from the land user or improper use of land contrary to the purpose stated in the land lease decision or contract, but not subject to land recovery under the laws on land or pursuant to point i, Clause 1, Article 64 of the Land Law, they must repay the state budget the amount of land rent that has been exempted or reduced. The recovery of the exempted or reduced land rent is carried out as follows:

a) The amount of land rent exempted or reduced to be recovered is determined based on the land price in the Land Price Table, land price adjustment coefficient, and percentage rate (%) for calculating the land rent unit price issued by the provincial People's Committee at the time of the decision to exempt or reduce land rent, plus late payment fees calculated based on the amount to be recovered according to the legal regulations on tax management at each period. The land user does not need to repay the exempted or reduced amount in areas with investment incentives;

b) The period for calculating late payment fees as stipulated in point a of this clause is from the date the tax authority issues the decision to exempt or reduce land rent to the date the competent state authority decides to recover the exempted or reduced land rent;

c) The Tax Department determines and reports to the provincial People's Committee to decide on recovering the exempted or reduced land rent for organizations and overseas Vietnamese, foreign-invested enterprises;

d) The District Tax Office determines and reports to the district People's Committee to decide on recovering the exempted or reduced land rent for households and individuals;

đ) The tax authority issues the Decision to Recover the Decision to Exempt or Reduce Land Rent in accordance with the law.

9. In cases where the entity leased land by the State pays the land rent once for the entire lease period and is exempted from all land rent, but during the lease period, there is a willingness to pay the land rent (without enjoying incentives), the amount of land rent to be paid once for the remaining lease period is determined based on the policy and land price at the time the land user submits the request to pay the land rent. The land user has the corresponding rights to the remaining lease period as if they were not exempted from land rent.

10. In cases where the current lessee does not belong to the category eligible for incentives to exempt or reduce land rent or belongs to the category eligible for incentives but has exceeded the incentive period when allowed by the competent state authority to change the land use purpose to implement an investment project eligible for incentives to exempt or reduce land rent, and the lease period of the land after the change of purpose is 50 years or more starting from the date of the decision to change the land use purpose, then they are entitled to exemptions or reductions in land rent according to the provisions.

7. Amend Article 21 as follows:

"Article 21. Procedures and formalities for exempting or reducing land rent and water surface rent"

1. The lessee submits the application dossier for exemption or reduction of land rental fees to the tax authority directly responsible for collection or to the agency receiving administrative procedures related to land as prescribed in Decree No. 43/2014/NĐ-CP. In case the application dossier for exemption or reduction of land rental fees is submitted to the agency receiving administrative procedures related to land, the transfer of the dossier to the tax authority shall be carried out according to the legal provisions on the procedures and processes for receiving and transferring dossiers to determine financial obligations regarding land of land users.

2. Based on the dossier specified in Clause 3 of this Article, the tax authority determines and decides the amount of land rental fees exempted or reduced; specifically:

a) The Director of the Tax Department issues the decision on exemption or reduction for economic organizations; foreign organizations and individuals, and overseas Vietnamese leasing land;

b) The Head of the Tax Revenue Office issues the decision on exemption or reduction for households and individuals leasing land.

3. Dossier for exemption or reduction of land rental fees

a) Dossier for exemption of land rental fees during the basic construction period

- Application letter requesting exemption of land rental fees (specifying: Leased land area, lease term; reasons for exemption and duration of exemption of land rental fees): One original copy;

- Investment Certificate or Investment License or Registration Certificate of Investment or Decision on Investment Orientation (except in cases where such certificates/licenses are not required under investment laws): 01 copy;

- Approved investment project in accordance with investment laws (except in cases where Investment Certificates, Licenses, Registration Certificates, or Investment Orientation Decisions are required under investment laws): 01 copy;

- Decision approving the investment project as prescribed by law: One copy;

- Decision on land lease issued by the competent state agency: One copy.

b) Dossier for exemption or reduction of land rental fees as prescribed by laws on investment

- Application letter requesting exemption or reduction of land rental fees (specifying: Leased land area, lease term; reasons for exemption or reduction and duration of exemption or reduction of land rental fees): One original copy;

- Investment Certificate or Investment License or Registration Certificate for Investment or Decision on Investment Policy (except in cases where such documents are not required under the laws on investment and in cases where land is transferred from being granted without payment of land use fee to being leased or where land is leased and is subject to exemption or reduction of land rental fees): One copy;

- Approved investment project as prescribed by laws on investment (except in cases where land is transferred from being granted without payment of land use fee to being leased or where land is leased and is subject to exemption or reduction of land rental fees): One copy;

- Decision approving the investment project as prescribed by law: One copy;

- Decision on land lease issued by the competent state agency: One copy;

In cases where the investment project has been issued with an Investment Certificate or Investment License or Registration Certificate for Investment or Decision on Investment Policy, the approved investment project dossier does not need to be included in the dossier (except in cases stipulated in points c and d, Clause 2, Article 15 of the Law on Investment).

c) Dossier for exemption or reduction of land rental fees for cases prescribed in points a, b, c, d, Clause 1, Decree No. 46/2014/NĐ-CP (amended and supplemented in Clause 5, Article 3 of Decree No. 135/2016/NĐ-CP)

- Application letter requesting exemption or reduction of land rental fees (specifying: Leased land area, lease term; reasons for exemption or reduction and duration of exemption or reduction of land rental fees): One original copy;

- Decision on land lease issued by the competent state agency: One copy;

- Documents proving eligibility for exemption or reduction of land rental fees: One copy.

d) Dossier for exemption of land rental fees during the temporary suspension period due to force majeure as prescribed in Clause 1, Article 47 of the Investment Law 2014

- Application letter requesting exemption of land rental fees during the temporary suspension period: One original copy;

- Confirmation document from the investment registration agency regarding the temporary suspension period of the project or confirmation document from the competent state agency: One original copy;

- Decision on land lease issued by the competent state agency: One copy.

đ) Dossier for exemption or reduction of land rental fees for cases where the project investor implements a housing construction project for workers on land subleased from infrastructure development enterprises in industrial zones or clusters

- Letter from the infrastructure development enterprise proposing exemption of land rental fees for the area of land leased to secondary investors to implement the Housing Construction Project for Workers: One original copy;

- Letter from the secondary investor leasing land from the infrastructure development enterprise proposing exemption of land rental fees to implement the Housing Construction Project for Workers: One original copy;

- Housing Construction Project for Workers established, reviewed, and approved in accordance with laws on investment and housing: One copy;

- Decision approving the investment project for housing construction for workers as prescribed by law: One copy;

- Lease agreement between the project investor implementing the Housing Construction Project for Workers and the infrastructure development enterprise in industrial zones or clusters: One copy.

e) Dossier for exemption or reduction of land rental fees for land used for scientific research facilities

- Application letter requesting exemption or reduction of land rental fees (specifying: Land for laboratory construction, land for technology incubation and science and technology business incubation, land for experimental facility construction, land for trial production facility construction): One original copy;

- High-tech Enterprise Certificate, Science and Technology Enterprise Certificate, Science and Technology Organization Certificate: One copy;

- Decision on land lease issued by the competent state agency: One copy.

4. The time limit for the lessee to submit the application dossier for exemption or reduction of land rental fees is specified as follows:

a) For exemption or reduction of land rental fees during the basic construction period and as prescribed by laws on investment (except in cases stipulated in points c and d, Clause 2, Article 15 of the Law on Investment), it must be within 20 days from the date the competent state agency signs the decision on land lease;

b) For exemption or reduction of land rental fees prescribed in points a, b, c, d, Clause 1, Decree No. 46/2014/NĐ-CP (amended and supplemented in Clause 5, Article 3 of Decree No. 135/2016/NĐ-CP), the lessee must submit the dossier within a maximum period of 30 days from the date when they must switch to leasing land or the date when they start being exempted or reduced from land rental fees according to the laws on land or other effective dates set by the Government or the Prime Minister.

5. The time limit for the tax authority to issue the decision on exemption or reduction of land rental fees or notify that the exemption or reduction of land rental fees is not granted due to non-compliance with legal conditions

a) Not more than twenty days from the date of receiving complete valid documents for exemption or reduction of land lease fees during the construction period.

b) Not more than thirty days from the date of receiving complete valid documents for exemption or reduction of land lease fees for institutions entitled to incentives under investment laws (excluding cases stipulated in points c and d, Clause 2, Article 15 of the Investment Law) and cases stipulated in points a, b, c, and d, Clause 1, Article 18 of Decree No. 46/2014/ND-CP (amended and supplemented in Clause 5, Article 3 of Decree No. 135/2016/ND-CP).

c) Not more than twenty days from the date of receiving complete valid documents for exemption or reduction of land lease fees for cases entitled to exemption or reduction of land lease fees as stipulated in points c and d, Clause 2, Article 15 of the Investment Law.

d) Not more than twenty days from the date of receiving complete valid documents for exemption of land lease fees during the temporary cessation of operations as stipulated in Clause 1, Article 47 of the Investment Law. The tax authority shall coordinate with the investment registration agency and other agencies (if necessary) to conduct on-site inspections, determine the specific period of temporary cessation of operations, and issue decisions on exemption of land lease fees in accordance with regulations.

đ) Not more than twenty days from the date of receiving complete valid documents for exemption of land lease fees for cases where the project investor implements a housing construction project for workers leasing land within industrial zones or clusters of enterprises operating infrastructure according to planning approved by competent state authorities.

6. Determining the construction period eligible for exemption of land lease fees

a) Based on the documents for exemption or reduction of land lease fees, the tax authority shall coordinate with relevant agencies to determine the construction period and issue decisions exempting land lease fees for each investment project, but not exceeding three years from the date of the land lease decision.

In cases where the Certificate of Investment or Investment License or Registration Certificate of Investment or Decision on Investment Orientation issued by the competent authority initially according to the law includes the construction period (project implementation schedule), the tax authority shall base its decision to exempt land lease fees for each project on the Certificate of Investment, Investment License, or Registration Certificate of Investment, but not exceeding three years from the date of the land lease decision.

b) In cases where the entity renting land from the State does not request exemption of land lease fees during the construction period, the exemption period according to investment laws shall be calculated from the date of the land lease decision. If the submission of exemption documents is delayed as stipulated in point a, Clause 2 of this Article, then only the remaining preferential period (if any) will be exempted from the date the tax authority receives complete documents in accordance with regulations, and no exemption will apply during the period of delayed submission.

7. Determining the amount of land lease fees eligible for exemption or reduction according to investment laws to be recorded in the Decision on Exemption or Reduction of Land Lease Fees

a) For cases of annual payment of land lease fees:

- In cases where the land value for calculating land lease fees has been determined by the competent state authority according to the law at the time of submitting the exemption or reduction documents, the amount of land lease fees eligible for exemption or reduction shall be based on the land value for calculating land lease fees.

- In cases where the competent state authority has not yet determined the land value for calculating land lease fees according to the law at the time of submitting the exemption or reduction documents, the amount of land lease fees eligible for exemption or reduction shall be based on the land value in the Land Price Table, the adjustment factor for land prices, and the percentage rate (%) for determining the unit price of land lease fees as issued by the People's Committee of the province.

- In cases where the annual payment of land lease fees is reduced by 50% for the entire lease period or for some years, the amount of reduction recorded in the Decision on Reduction of Land Lease Fees shall be based on the stable unit price of land lease fees at the time of issuing the Decision and adjusted accordingly when the unit price of land lease fees is adjusted according to regulations.

b) For cases of one-time payment of land lease fees for the entire lease period:

- In cases where the entire land lease fees for the entire lease period are exempted, the amount of land lease fees eligible for exemption recorded in the Decision on Exemption of Land Lease Fees shall be determined according to the provisions of point a of this clause.

- In cases where the land value for calculating land lease fees is determined according to the method of adjusting land prices by factors and is exempted for some years, but the competent state authority has not yet determined the land value for calculating land lease fees according to the law at the time of submitting the exemption documents, the amount of land lease fees eligible for exemption recorded in the Decision on Exemption of Land Lease Fees shall be determined as follows:

- In cases where the land value for calculating land lease fees is determined according to the direct comparison, income, deduction, surplus methods and is exempted for some years, but the competent state authority has not yet determined the land value for calculating land lease fees according to the law at the time of submitting the exemption documents, the tax authority shall transfer information about the exemption period to the natural resources and environment agency to determine the one-time land value for calculating land lease fees corresponding to the period of land lease fee payment. The amount of land lease fees eligible for exemption recorded in the Decision on Exemption of Land Lease Fees shall be determined as follows:

Period of land lease fee payment equals the lease period minus (-) the exemption period of land lease fees (including exemption of land lease fees during the construction period).

- In cases where land lease fees are exempted for some years, and the competent state authority has already determined the land value for calculating land lease fees for the entire lease period according to the law (excluding the factor of the lease period exempted) at the time of submitting the exemption documents, the amount of land lease fees eligible for exemption shall be deducted from the amount of land lease fees payable (already determined) and recorded in the Decision on Exemption of Land Lease Fees as follows:

8. Amend and supplement Clause 3, and add Clause 5 to Article 24 as follows:

"3. The payment of land rent and water surface rent for cases where annual rent payments are made shall be divided into two periods: The first period requires a minimum of 50% to be paid before May 31; the second period requires the remaining amount to be paid before October 31 each year. In cases where the financial obligation regarding land rent and water surface rent for the first year must be determined from October 31 to December 31 of the year, the tax authority shall issue a notice for the payment of land rent and water surface rent for the remaining time of the year, with the deadline for the first year's payment being 30 days from the date of issuance of the Notice. If the payment deadlines specified on the tax authority's Notice are exceeded for each payment period, the lessee shall pay late fees on the unpaid amounts according to the provisions of the law on tax administration."

"5a. In cases where the State leases land or water surfaces before July 15, 2014, and such cases are required to make up for back rent for the period of land use, "

"a) Within 30 days from the date of signing the Notice to make up for back rent issued by the tax authority, the lessee must pay 50% of the land rent as stated in the Notice;"

"b) Within the following 60 days, the lessee must pay the remaining 50% of the land rent as stated in the Notice to make up for back rent;"

"c) If the lessee fails to fully pay the back rent as stipulated in points a and b of this clause within the prescribed deadlines, they must pay late fees on the unpaid amounts according to the provisions of the law on tax administration."

"9. Supplement Clause 5, Clause 6, Clause 7, and Clause 8 to Article 32 as follows:"

"5. In cases where state-owned enterprises have officially been converted into joint-stock companies before July 1, 2014 but are required to adjust the unit price of land rent, settle the temporarily paid land rent, and make up for back rent according to the provisions of point b, Clause 4, Article 32 of Decree No. 46/2014/NĐ-CP, the following measures shall be taken:"

"a) In cases where the competent state agency has not yet completed the settlement and transfer of capital and assets to the joint-stock company at the time the tax authority issues a notice to make up for back rent for the state-owned enterprise, the joint-stock company shall be responsible for paying the back rent into the state budget. The land rent paid by the joint-stock company shall be handled according to the regulations on the settlement and transfer of capital and assets to the joint-stock company;"

"b) In cases where the competent state agency has already completed the settlement and transfer of capital and assets to the joint-stock company according to the laws on the shareholding reform of state-owned enterprises at the time the tax authority issues a notice to make up for back rent, the joint-stock company does not need to pay the back rent of the state-owned enterprise as stipulated in point b, Clause 4, Article 32 of Decree No. 46/2014/NĐ-CP until the official conversion into a joint-stock company;"

"6. For cases where the State leases land with annual rent payments and is currently in the stable period of the unit price of land rent, if the provincial People's Committee decides to reduce the percentage rate (%) for calculating the unit price of land rent and the adjustment factor for land prices to support businesses and resolve difficulties, the reduced percentage rate (%) and adjustment factor for land prices shall be applied from the effective date of the Decision of the provincial People's Committee and for the remaining time of the stable period of the unit price of land rent. When the stable period ends, the unit price of land rent shall be adjusted according to the policy and land prices at the time of adjustment;"

"7. Handling of water surface (sea surface) rent for exploration and exploitation contracts for oil and gas that are still valid and signed before July 1, 2017, shall be as follows:"

"a) For contracts that have agreed to pay sea surface rent, the contractor must pay according to the signed contract. In cases where the oil and gas contract stipulates that the Vietnam Oil and Gas Group (PVN) is responsible for refunding the contractor the amounts paid from the contractor's account for taxes and mandatory payments (including sea surface rent), PVN shall pay the sea surface rent or refund the contractor the sea surface rent that the contractor has paid;"

"b) For oil and gas contracts that stipulate that the contractor is exempt from all taxes and other mandatory payments (under any name) or sea surface rent not included in the list of financial obligations that the contractor must fulfill according to the laws on oil and gas, the contractor does not need to pay sea surface rent;"

"c) For contracts signed according to the model contract under Decree No. 33/2013/NĐ-CP dated April 22, 2013, the contractors do not need to pay sea surface rent. When the contract expires and is extended according to the laws on oil and gas, the contractor must pay sea surface rent according to the regulations at the time of extension;"

"8. In cases where investors have paid compensation and clearance costs according to the plan approved by the competent state agency (including self-negotiated compensation or self-transfer acceptance) before July 1, 2004, and have been leased land by the State after July 1, 2004, they may deduct the compensation for land and support for land according to the approved plan or the value of the land use rights for the purpose of legitimate transfer acceptance (in cases of self-negotiated compensation or self-transfer acceptance) at the time of self-negotiation or self-transfer acceptance (allocated to the remaining lease period corresponding to the area subject to land rent and not yet accounted for in production and business expenses) from the land rent payable and not exceeding the land rent payable. The amount deducted from the payable rent shall be converted into the time already completed for annual rent payments. The unit price of land rent for conversion shall be applied according to the policy and land prices on January 1, 2016."

10. The Minister of Finance shall provide specific guidance on this Article.

Article 4. Effective date

1. This Decree takes effect from January 1, 2018.

2. Repeal Article 7.9 of the Model Contract issued together with Decree No. 33/2013/NĐ-CP dated April 22, 2013 of the Government.

3. The Ministers, Heads of ministerial-level agencies, Heads of government agencies, Chairpersons of provincial People's Committees under central cities shall be responsible for implementing this Decree./.