JOINT CIRCULAR No. 92-TT/LB Circular guiding the implementation of Decree No. 73-CP dated October 25, 1993 of the Government detailing the classification of land for agricultural land use tax

JOINT CIRCULAR

OF THE MINISTRY OF FINANCE, THE MINISTRY OF AGRICULTURE AND RURAL DEVELOPMENT,

LAND MANAGEMENT DEPARTMENT DECREE NO. 92-TT/LB

NOVEMBER 10, 1993 GUIDING IMPLEMENTATION

GOVERNMENT DECREE NO. 73/CP OF OCTOBER 25, 1993 ON DETAILING THE CLASSIFICATION OF LAND FOR LAND USE TAX

Pursuant to the Law on agricultural land use tax; pursuant to Government Decree No. 73/CP dated October 25, 1993 detailing the classification of land for agricultural land use tax; the Ministry of Agriculture and Rural Development, the Ministry of Finance, and the Land Management Department hereby guide as follows: AGRICULTURE

I. DETERMINATION OF STANDARDS FOR FACTORS OF EACH CLASSIFIED LAND FOR TAX PURPOSES

1. Soil factor: The soil factor refers to the fertility of the land (type of soil, depth of cultivation or depth of soil layer, humus content...) suitable for each type of crop; for land with brackish water for aquaculture, it also includes salinity and nutrient content of the water. The specific soil factors for major crops are as follows:

a. For paddy fields:

- Highly fertile land (10 points) includes alluvial soils from the Red River system, the Mekong Delta system, the Thai Binh River system, the lower Thu Bon River, and the lower Ba River.

- Moderately fertile land (7 points) includes alluvial soils from other rivers; slightly and moderately acid sulfate soils, slightly and moderately saline soils in the Red River Delta and the Mekong Delta.

- Less fertile land (5 points) includes alluvial soils prone to flooding, gray soils, sloping soils, yellow-red soils altered by rice cultivation, slightly and moderately acid sulfate soils, slightly and moderately saline soils not in the Red River Delta and the Mekong Delta.

- Very infertile land (2 points) includes heavily acid sulfate soils, heavily saline soils, swampy soils, coastal sandy soils, depleted soils... these types of land require improvement before they can be cultivated.

b. For land with brackish water for aquaculture:

- Highly fertile land (10 points) includes alluvial soils and clay-silt soils rich in nutrients.

- Moderately fertile land (7 points) includes slightly acid sulfate soils with low nutrient content.

- Less fertile land (5 points) includes moderately acid sulfate soils that need improvement to be suitable for aquaculture.

- Very infertile land (2 points) includes heavily acid sulfate soils, muddy soils, very nutrient-poor sandy soils that require long-term improvement to be suitable for aquaculture.

c. For perennial industrial crops and perennial fruit trees:

- Highly fertile land (10 points) includes soils suitable for each type of crop in each locality, with a depth greater than 100 cm and a humus content above 2.5%.

- Moderately fertile land (8 points) includes relatively suitable soils for each type of crop in each locality, with a depth between 70 cm and 100 cm and a humus content between 1% and 2.5%.

- Very infertile land (6 points) includes soils less than 70 cm deep mixed with sand and gravel, with a humus content below 1%, requiring significant investment for improvement before perennial crops can be grown.

2. Location factor:

a. For annual crop land, grassland, and planted forests: The location factor is determined from the production site to the place of residence of the land user household. The place of residence of the land user household is defined as the center of the village (hamlet), ấp, bản where the land is located, with a scale of points: 7, 5, 3, 1.

b. For perennial crop land (excluding planted forests) and land with brackish water for aquaculture: The location factor is determined from the center of the village (hamlet), ấp, bản where the land is located to the nearest city or town. For enterprises, it is calculated from the enterprise headquarters to the nearest commune or town, with a scale of points: 6, 4, 2 for perennial crop land and a scale of points: 7, 5, 3, 1 for land with brackish water for aquaculture.

3. Topography factor: as stipulated in Article 1 of Government Decree No. 73/CP dated October 25, 1993 and detailed in the table of standards for each factor to classify land for taxation of major crops attached hereto.

For annual crop land and aquaculture water surface, the scale of points is: 8, 6, 4, 2.

For perennial industrial crops and perennial fruit trees, the scale of points is: 8, 6, 4.

4. Climate and weather conditions factor: including average annual temperature; average annual rainfall; wind, storm, flood volume in a year; number of dry months, number of hot months (Lao wind); salt fog volume. These factors are evaluated at two levels of limitation or non-limitation to the growth of crops. Each factor is considered limiting if it occurs regularly every year, affecting the growth of crops. These factors are summarized and evaluated according to the standards for each type of crop on the land as follows:

- Favorable for rice planting, with no limitations (10 points), meaning there is no worst factor.

- Highly fertile land (10 points) includes alluvial soils from the Red River system, the Mekong Delta system, the Thai Binh River system, the lower Thu Bon River, and the lower Ba River.

- Relatively favorable for rice planting, with one limiting condition (7 points), which is the worst condition as mentioned above.

- Relatively favorable for rice planting, with two worst conditions (5 points).

- Unfavorable for rice planting, with at least four limiting conditions (2 points) such as storms, floods, salt fog, Lao wind.

b. For land with brackish water for aquaculture, it is determined similarly to paddy fields.

c. For perennial industrial crops, perennial fruit trees, and planted forests, they are divided into three levels suitable for each type of crop: favorable (10 points), relatively favorable (8 points), and less favorable (6 points).

5. Irrigation and drainage factor (water regime) includes both state investment and natural irrigation and drainage.

a. For paddy fields and aquaculture water surface, they are divided into four levels according to the standard table of factors for classifying land for taxation attached to Government Decree No. 73/CP dated October 25, 1993. The four levels correspond to the scale of points: 10, 7, 5, 2.

b. For perennial industrial crops and perennial fruit trees, they are divided into three levels: favorable (10 points), relatively favorable (8 points), and less favorable (6 points) suitable for each type of crop in each locality.

II. CLASSIFICATION OF LAND FOR TAXATION FOR MAJOR CROPS

1. For annual crop land: first classify paddy fields; based on this, classify other types of crop land.

1. For annual crop land: classify paddy fields first; based on that, classify other types of crop land.

When classifying land for rice cultivation, it must be based on the classification standards of five main factors and combined with the average yield achieved under normal farming conditions over five years (1986-1990). The achieved yield is a factor to verify the land classification according to the five factors as follows:

- Paddy fields classified into the same tax category must have the same standards of the five factors; in cases where they meet the same land classification standards of the five factors but have different yields, they will still be in the same tax category.

- Paddy fields achieving the same yield but differing in the land classification standards of the five factors, the field with higher scores from the five factors will be classified into a higher tax category, while the field with lower scores from the five factors will be classified into a lower tax category.

The yield used for reference and verification of land classification for taxation purposes is the yield achieved under normal weather conditions with medium-level farming techniques and intensification at the local level.

When classifying land for annual crop cultivation, it must be based on the classification standards of the five factors and the land classification results for rice, comparing the five factors of the rice cultivation land adjacent or nearest to the five factors of other annual crop cultivation land.

2. For land with water surfaces for aquaculture:

Land with water surfaces used for both aquaculture and annual crop cultivation shall be classified for taxation as if it were land for annual crop cultivation.

Ponds, lakes, and swamps used for aquaculture shall be classified for taxation according to the adjacent annual crop cultivation land or the nearest land.

Land with brackish water surfaces exclusively used for aquaculture must be based primarily on soil quality, water quality, location, climate, topography, and drainage conditions, and combined with the average yield achieved under normal farming conditions over five years (1986-1990) or the most recent years.

3. Grassland used for livestock breeding shall be classified for taxation as if it were land for annual crop cultivation.

4. For perennial crop cultivation land (excluding timber tree cultivation land and other perennial crops harvested once), the land classification shall be carried out as follows:

- Perennial crop cultivation land in areas of specialized cultivation or widespread cultivation, or garden land within residential areas, shall be based on the standards of the five factors to determine the tax category for perennial crop cultivation land such as rubber, tea, fruit trees (citrus), coconut, and cashew (kernels).

- Perennial crop cultivation land interspersed with annual crop cultivation land shall be classified as if it were adjacent annual crop cultivation land.

- Garden land or land planted with various types of perennial crops shall be classified as if it were adjacent specialized perennial crop cultivation land; in cases where there are no adjacent specialized perennial crop cultivation lands, it shall be classified as if it were adjacent annual crop cultivation land.

Timber cultivation land and other perennial crops harvested once include: wood, bamboo, rattan, mahogany, teak, and other types of trees whose trunks are no longer present or no longer capable of producing products after the first harvest.

Such cultivation land shall not be classified, but taxed based on the volume of extraction according to Clause 3, Article 2 of Decree No. 73/CP dated October 25, 1993 of the Government.

III. PROCEDURE FOR CLASSIFYING LAND FOR TAXATION OF AGRICULTURAL LAND USE

1. At the provincial level:

Based on Article 1 of Decree No. 73/CP dated October 25, 1993 of the Government; based on the standards of each factor to classify land for taxation of major crops and guidance from the Ministry of Agriculture and Food Industry, Ministry of Finance, and Land Management; the Provincial Tax Department shall cooperate with agricultural and land management agencies at the provincial level to implement:

- Propose the structure of land categories for annual crop cultivation, perennial crop cultivation, and brackish water surfaces for aquaculture suitable for the degree of classification factors and crop yields of each district, submit to the People's Committee of the province for allocation to districts in the first quarter of 1994;

- Submit to the People's Committee of the province or centrally-administered city for decision on the maximum and minimum points of each factor according to major crops of each district, county, town, and city within the province to build the land categories for taxation of agricultural land use for communes.

2. At the district level:

Based on land classification standards and this Circular's guidance; based on provincial directives; based on the proposed land category structure assigned by the People's Committee of the province, the District Tax Office shall cooperate with the Tax Advisory Board (related sectors) to propose the land category structure of each commune, ward, town, and the tax amount to be collected based on that, directing communes, wards, and towns to classify land for taxation.

3. At the commune level:

Based on Article 1 of Decree No. 73/CP dated October 25, 1993 of the Government; based on provincial and district guidance. Following the directive of the District People's Committee, the commune tax team together with the commune tax advisory board assist the Commune People's Committee in classifying land for taxation down to each plot of land used by households.

Classify the main crop cultivation land first according to village, hamlet, and village boundaries; based on that, classify land for other types of crop cultivation. The land classification must be carried out according to each paddy field based on actual land conditions, number of cropping seasons, and referencing the average yield achieved under medium-level farming and intensification conditions at the local level as detailed in Decree No. 73/CP dated October 25, 1993 of the Government. Pay attention to determining the topographical, locational, and yield factors according to each type of crop in each area of cultivated land.

The tax authority together with land management and agriculture officers shall propose the land classification for taxation of the commune, put forward for discussion and review by the advisory board; based on that, the tax authority assists the Commune People's Committee in summarizing the land classification results.

The land classification results before reporting to the District People's Committee must be posted for public knowledge for participation within twenty days.

IV. REVIEW OF LAND CLASSIFICATION FOR TAXATION

1. The Tax Revenue Office shall coordinate with the County Tax Advisory Board (relevant sectors) to assist the People's Committee of the county in inspecting and reviewing the land classification for agricultural land tax of communes and units directly registered by the County Tax Revenue Office. In cases where there is no agreement between the County Tax Advisory Board and the communes, the People's Committee of the county shall instruct the communes to redo their work. The Tax Revenue Office shall assist the People's Committee of the county in compiling and reporting to the Provincial Tax Department and submitting to the People's Committee of the province for approval.

2. The Provincial Tax Department shall coordinate with the Provincial Tax Advisory Board (relevant sectors) to assist the People's Committee of the province in compiling and reviewing the land classification for agricultural land tax of counties and units directly registered by the Provincial Tax Department for submission to the People's Committee of the province for approval and reporting to the Ministry of Finance (General Department of Taxation) for submission to the Government.

3. The Ministry of Finance, together with the Ministry of Agriculture and Food Industry and the General Land Management Department, shall inspect the compilation and review of land classification for agricultural land tax of provinces and cities; prepare necessary documents for the Ministry of Finance to submit to the Government for approval of land classification for tax purposes for localities.

V. IMPLEMENTATION

1. People's Committees at all levels shall be responsible for directing the relevant sectors: tax, agriculture, land management, and lower-level People's Committees to implement the work of classifying land for agricultural land tax.

2. This Circular shall take effect from November 10, 1993. Previous regulations on land classification for agricultural land tax shall only remain effective until December 31, 1993.