Circular No. 60/TC-TCT guiding the management regime for revenue from the sale of state-owned houses and the grant of land use rights for housing construction.

CIRCULAR

OF THE MINISTRY OF FINANCE

Guidelines for managing revenue from the sale of state-owned houses,

granting land use rights for residential construction and infrastructure projects

In recent times, many localities have sold state-owned houses, granted land use rights to organizations and individuals for residential construction, or granted land use rights to organizations and individuals to invest capital in constructing certain infrastructure projects. However, there has been no unified national management system, leading to lax management of assets and funds, resulting in significant loss of state budget revenues.

While awaiting the government's issuance of a general management policy, the Ministry of Finance temporarily guides the management of revenue from the sale of state-owned houses and the grant of land use rights for residential construction or investment in infrastructure projects at local levels as follows.

 

I. MANAGEMENT OF REVENUE FROM THE SALE OF HOUSES

1. Revenue from the sale of houses shall be deposited into the state budget for:

The sale of residential houses owned by the state as stipulated in Section 1 of Circular No. 06/LB-TT dated February 10, 1993, issued jointly by the Ministry of Construction and the Ministry of Finance;

The sale of factories, warehouses, office buildings, shops, etc., constructed with state budget funds;

For houses (residential, office, warehouse, etc.) built by agencies and enterprises using welfare funds or self-supplemented funds, when valuing and selling, the revenue from the transfer of land use rights attached to the house must be deposited into the state budget.

2. All agencies, Party organizations, mass organizations, armed forces, enterprises, companies, holding companies, businesses, etc., which manage state-owned houses (hereinafter referred to collectively as house management agencies) that sell houses or transfer land use rights attached to houses as prescribed in this Circular, must deposit the proceeds from such sales into the state budget.

3. Revenue from the sale of houses not required to be deposited into the state budget according to this Circular includes:

Proceeds from the sale of houses not owned by the state (excluding the price of transferring land use rights attached to the house), including the value of houses constructed with contributions from organizations and individuals;

Proceeds from the sale of houses together with the transfer of land use rights attached to the house, where taxes on income have already been paid according to Resolution No. 32 NQ/UBTVQH 9 dated March 10, 1993, of the Standing Committee of the National Assembly.

4. Method for calculating revenue from the sale of houses to be deposited into the state budget.

The revenue from the sale of houses is determined based on the remaining actual value of the house (based on quality and grade), the price of transferring land use rights attached to the house, and any applicable price reduction according to regulations, calculated by the formula:

In cases where the price of transferring land use rights attached to the house built with welfare funds and self-supplemented funds of the unit, it is determined by subtracting compensation costs for land damage, leveling costs (if any), and any applicable price reduction according to regulations from the price of transferring land use rights attached to the house.

Each locality should establish a House Sale Pricing Council, consisting of representatives from the following agencies: Construction, Land Management, Finance and Prices, Taxation, and House Management.

In principle, revenue from the sale of state-owned houses and the price of transferring land use rights attached to the house are state budget revenues that must be fully deposited into the state budget.

However, to cover expenses related to valuation organization, the house management agency may retain 2% (two percent) of the sale price to fund the work of investigating, evaluating houses, purchasing declarations, and organizing the payment of money into the state budget.

The remaining revenue from the sale of houses after deducting the aforementioned 2%, must be fully deposited into the state budget.

At year-end, the house management agency must settle accounts with the tax and finance authorities directly managing the unit regarding the use of the retained 2% of the sale price. If not fully utilized, the remaining amount must be deposited into the state budget.

5. Declaration and Payment of Revenue from the Sale of Houses

a) All house management agencies mentioned in Point 1, Section 1 of this Circular, must declare all relevant documents concerning the origin of the house, along with the sale of the house, within thirty days from the date of signing the house purchase and sale contract, including:

Certificate of ownership of the house or source of construction funds;

Location, area of the house, and area of attached land.

List of eligible buyers, areas purchased, and proof of eligibility for policy exemptions (if any).

Purchase and sale contract for the house and transfer of land use rights, clearly stating the area, sale price, payment terms, etc.

Invoice for the sale of the house (at the actual sale price).

(Declaration form according to Model 1 attached).

b) After receiving the declaration from the house management agency, the local tax authority where the house is located will verify the declared information, determine the area and sale price of the house, and notify the payment into the state budget. The notification must specify the total amount of house sale revenue to be paid into the state budget, the payment deadline. The payment deadline is based on the payment term stated in the purchase and sale contract.

Based on the payment deadline into the state budget notified by the tax authority, the house management agency will issue a payment receipt to the state treasury, recording it under the corresponding chapter, type, item, and sub-item of the state budget classification under Item 09. Simultaneously, units and enterprises must report to the finance authority to reduce the state budget allocation corresponding to the transferred assets such as factories, warehouses, offices, etc., that have been valued.

As for the amount of money from selling state-owned houses that has been collected but not yet submitted to the state budget before this Circular was issued, the house management agencies must now declare to the tax authority and submit to the state budget according to the guidelines set out in this Circular. The entire amount of money collected from selling houses that should be submitted to the state budget must be fully paid by August 31, 1993. However, the amount of money from selling factories, warehouses, office buildings, shops constructed with state budget funds sold before this Circular was issued and used for reinvestment in fixed assets as stipulated in Article 2 of Decision No. 332-HĐBT dated October 23, 1991 of the Council of Ministers (now the Government) shall not be subject to recovery according to this Circular.

 

II- ON THE MANAGEMENT OF REVENUE FROM GRANTING RIGHTS TO USE LAND
CONSTRUCTION OF HOUSING AND WORKS

1- The difference between the amount of money received when granting rights to use land for organizations and individuals to construct housing and works, and the amount spent on compensation for losses and damages, crop indemnities, lawful property on the land, and costs for leveling and improving the land (if any), must be submitted to the state budget according to this Circular.

2- The entities responsible for submitting the revenue from granting rights to use land include all agencies and organizations authorized to manage land, grant rights to use land, and directly collect money from organizations and individuals granted land.

3- Revenue from granting rights to use land does not need to be submitted to the state budget according to this Circular in the following cases:

Compensation for agricultural land and forest land losses as prescribed in Decision No. 186/HĐBT dated May 31, 1990 of the Council of Ministers (now the Government);

Rent for land of foreign organizations as prescribed in Decision No. 210a TC/VP dated April 1, 1990 of the Ministry of Finance;

Collection of land administration fees.

4- Method of calculating the revenue from granting rights to use land to be submitted to the state budget:

According to Point 1, Section II of this Circular, the revenue from granting rights to use land to be submitted to the state budget is calculated using the following formula:

Where:

Total revenue from granting rights to use land = actual area of land granted x rate of collection per square meter of land granted to organizations and individuals.

Compensation for agricultural land and forest land losses actually paid and submitted to the state budget, calculated according to Decision No. 186/HĐBT dated May 31, 1990 and Circular No. 18 TC/ĐT dated June 5, 1992 of the Ministry of Finance.

In cases where the contract for granting rights to use land specifies that the organization or individual receiving the right to use land must pay compensation for land losses, such payments cannot be deducted from the amount that the land management agency must submit to the state budget.

Crop indemnities and property on land (if any) are based on the actual amount compensated recorded on the payment voucher confirmed by the organization or individual receiving the compensation.

Costs for leveling and improving the land are based on the final settlement of expenses by the unit, based on reasonable and valid expenses.

5- Declaration and submission of revenue to the state budget.

a) All organizations and agencies, each time they grant rights to use land as specified in Point 1, Section II of this Circular, within fifteen days from the date of issuing the land use permit, must declare to the tax authority about the situation of granting land, including:

Total area of land granted (including the area granted to each organization and individual);

Rate of collection per square meter of land and total revenue from the land lot granted;

Actual expenditures on compensation for land losses, costs for improving and leveling the land, etc. (declared in detail according to Model Form No. 2 attached).

b) After receiving the declaration from the agency granting rights to use land, the local tax authority must check the declaration, determine the location, area, rate, revenue, and other related costs, and notify the agency granting rights to use land of the amount to be submitted and the deadline for submission to the state budget.

Based on the notification from the tax authority, the agency managing the granting of rights to use land must issue a payment receipt to the National Treasury, recording under Chapter 14, Clause 01, Item 9, Subitem 30 of the State Budget Register, and allocate 100% to the local budget.

For revenue from granting rights to use land that has not yet been submitted to the state budget, the land management agency must declare and submit it fully to the state budget according to this Circular by August 31, 1993.

 

III- MANAGEMENT OF REVENUE FOR GRANTING RIGHTS TO USE LAND TO SETTLE

THE VALUE OF COMPLETED PROJECTS

Granting rights to use land to organizations and individuals who have invested capital in constructing infrastructure projects, which are often not specifically expressed in monetary terms (in cases where the amount can be determined, apply as prescribed in Section II of this Circular). However, considering the essence, this is an agreement to use state budget revenue from granting rights to use land to settle the value of completed projects handed over, which are state assets managed by the state budget, implemented as follows:

1- All cases of granting rights to use land to organizations and individuals investing capital in construction projects must record income and expenditure through the state budget (record income from the amount of land use rights granted, and record expenditure for investment capital in construction projects accordingly).

2- The revenue from granting rights to use land is determined by the total value of the completed construction project handed over for management and use, as approved in the final settlement and acceptance certificate of the project.

For example, Organization A invests capital in building Bridge X. The final settlement of the completed project handed over for management and use by Province H is valued at 20 billion dong. Instead of paying Organization A 20 billion dong for building Bridge X, Province H grants Organization A a land use permit for Y hectares to build housing or engage in business... without specifying the monetary value of the land grant, it will record the revenue from the state budget for granting rights to use land as 20 billion dong, while recording the expenditure for investment capital in constructing Bridge X - 20 billion dong.

3- Procedures for recording income and expenditure in the state budget.

The local financial authority (Department of Finance if the construction project is under provincial management, District Financial Board - if the construction project is under district management) shall take the lead in coordinating with the following agencies: Construction, land management, tax, and the same-level supervising agency to organize the implementation:

Reviewing the entire list of cases of land allocation on the territory associated with construction projects handed over for use from 1990 to the present, categorizing which cases have been reflected in the state budget, and which remain outside the budget and have not been recorded in the State's fixed asset inventory;

For cases where land allocation was provided instead of payment for completed construction projects that have not been reflected in the state budget revenue and expenditure results, and in the State's fixed asset inventory, the basis shall be the following documents:

Contracts signed between the construction project investment unit and the state agency directly responsible for allocating land;

Final settlement value of the completed construction project handed over, accompanied by the completion acceptance record;

Land use right allocation documents.

Recording state budget revenue (for the year 1993) in the corresponding chapter, type 14, clause 01, item 9, sub-item 30 of the state budget manual, recording capital disbursement for construction projects according to the corresponding chapter, type, clause, item, and sub-item 53 of the state budget manual, the amount equal to the value of the completed construction project as per the approved final settlement.

4- Implementing the handover and recording an increase in the state budget capital allocated to the project management unit in accordance with the capital transfer regulations of the Ministry of Finance. The supervising entity is responsible for recording the increased capital and the corresponding fixed asset value based on the current transferred capital.

5- For cases where land allocation is provided instead of payment for basic construction projects handed over from now on, it is requested that the People's Committees of provinces and centrally-administered cities direct relevant departments at the local level to strictly manage them in accordance with the state regulations on land use rights allocation management and basic construction investment management, ensuring that all sources of income from land allocation and construction projects must be centrally managed and reflected in the annual state budget revenue and expenditure.

 

IV- HANDLING VIOLATIONS

All organizations and individuals who fail to declare, make false declarations, miss deadlines, fail to pay or underpay as stipulated in this Circular, in addition to paying the full amount as required, will also be subject to penalties as prescribed in Government Decree No. 01-CP dated October 18, 1992, "Regarding Administrative Violations in Tax Matters," and Circular No. 11 TC/TCT dated February 24, 1993, issued by the Ministry of Finance, guiding the implementation of the aforementioned decree.

V. IMPLEMENTATION

1- Organizing the collection of house sale proceeds and land use right allocation fees shall be carried out by the local tax authorities. Tax authorities at all levels are tasked with disseminating and guiding the declaration and payment of these revenues in accordance with this Circular.

Specifically, for organizing the management of land use right allocation fees collected instead of payment for basic construction projects, this shall be led by the Department of Finance in coordination with related agencies at the local level. However, the collection into the budget shall still be handled by the tax authorities using receipts issued by the Ministry of Finance.

2- It is requested that the People's Committees of provinces and centrally-administered cities, Ministries, State Councils, central Party and mass organizations coordinate to guide and implement this Circular accurately.

3- This Circular takes effect from August 1, 1993.

Cases previously guided for specific handling in this Circular shall be reflected in the state budget balance for 1993.

During the implementation process, if there are any issues encountered, relevant departments and localities should promptly report them to the Ministry of Finance for research and resolution.

 

FORM NO. 1

SOCIALIST REPUBLIC OF VIET NAM

Independence - Freedom - Happiness

HOUSE SALE DECLARATION FORM

1. Name of the house management agency:

.....

Address:…

2. House location:

House number:...alley (lane):...

Street (village):…

Ward (commune):...

District (county):…

3. Source of the house (funds for building the house) and classification of the house:

State-owned or other ownership (self-funded...):

Factory, warehouse, shop, etc...

Residential?

4. Total area (m²)

House (floor area)

Land attached to the house:

5. Total value (appraised value):

Where:

House

Land

6. Total amount of reduction for policy beneficiaries (if applicable)

......

7. Actual selling price (price on invoice = 5-6):...

Where:

House

Land

8. Amount of house sale revenue to be paid to the state budget (actual selling price minus 2% retained):...

Payment period:

Period 1, date... month... year...:... dong

Period 2, date... month... year...:... dong

I hereby certify that the information declared above is true, and if incorrect, I will accept the penalty as prescribed by law.

MODEL NO. 2

SOCIALIST REPUBLIC OF VIET NAM

Independence - Freedom - Happiness

 

LAND USE RIGHT ALLOCATION FEE COLLECTION DECLARATION FORM
CONSTRUCTION PROJECT SUPERVISION

1. Name of the land use right allocation management agency:

.......

Fax:

2. Plot number:

3. Total allocated area:

4. Number of households (organizations) allocated land:

5. Total amount collected from organizations and individuals allocated land:

....

6. Expenses incurred for the allocated plot:...

Including: - Compensation for land damage.

Compensation for crops and assets.

Site leveling costs.

7. Amount of land use right allocation fee to be paid to the state budget:

........

The agency hereby certifies that the information declared above is true, and if incorrect, we will accept the penalty as prescribed by law.