The proposal to apply a real estate transfer tax based on holding period - with a tax rate of up to 20% of profit - is being consulted by the Ministry of Finance and attracting many mixed opinions. From a professional perspective, Lawyer Truong Anh Tu - Chairman of TAT Law Firm, real estate and legal reform expert - said that it is necessary to design a layered tax system, sophisticated enough to distinguish speculative behavior from the legitimate needs of the people.
The weakness lies in the excessive simplification
The proposal to apply a real estate transfer tax according to the holding period with a tax rate of up to 20% of profit - is being consulted by the Ministry of Finance and attracting many mixed opinions. From a professional perspective, I think: It is necessary to design a layered tax system, sophisticated enough to distinguish speculative behavior from the legitimate living needs of the people.
I acknowledge the reform efforts. This is the first time the Ministry of Finance has boldly proposed a tax layering mechanism instead of collecting 2% as before. This thinking is in the right direction: high for "surfer", gradually lightening for long-term holders, partly reflecting speculative behavior.
However, the weakness lies in over-simplification. The holding period does not fully reflect the nature of speculation or not. Should a person forced to sell a house due to divorce, illness, or relocation - even after just a few months - be taxed at 10% like a professional speculator?
The biggest risk is hitting the wrong person in real life, causing insecurity and reducing market liquidity, especially when the market is currently already quiet. We need a smart tax ecosystem, based on many behavioral variables, not just one criterion.
I propose 5 specific groups of solutions:
First, tax according to transaction frequency: Those who buy and sell real estate many times in 3 - 5 years are clearly speculators. There is no need to consider the time to hold each real estate. This solution is on target, avoiding "unfairness" to people selling their houses due to personal circumstances.
Second, high tax on third- and above real estate: People who own 3 or more houses should be regulated more strongly. This is a way to layer investors - speculators and people with real needs, which can be implemented by connecting land databases via CCCD.
Third, according to the type of assets and virtual fever areas: Agricultural land waiting to change purpose, land for speculation, areas with unusual price fever should be taxed higher. Avoid the situation where "the whole market is cold before the winter winds come".
Fourth, tax gradually according to profit margin: Whoever sells at a loss or makes a small profit will have low tax, whoever makes a large profit will have high tax. Tax can be exempted for profits under VND 200 million, taxed at 5 - 10% from VND 200 million to VND 1 billion, and 15 - 20% for interest over VND 1 billion. This is fair and accurate reflection of profitability.
Fifth, encourage people to declare original purchase prices, store cost records: The State can allocate reasonable deductions for renovation costs, registration taxes, brokerage fees... to accurately calculate real profits. This is both transparent and reduces law evasion.
It is impossible to use the same tax mechanism for both speculation and inheritance
Another controversial issue is the imposition of a 2% tax on real estate of inherited origin, regardless of the holding period. This is a sensitive area. Taxing inherited assets is not simply an economic matter, but a matter of culture and race.
In Vietnam, parents leave land to their children not to get rich, but to have "land to build a family", to keep the family's discipline. If each generation has to "cut land to pay taxes", then after a few generations, the house will gradually become smaller - and the tax will continue to grow.
I do not deny the need for fairness in policies, but any fairness must be consistent with the cultural and national income context. We do not have a complete welfare system, do not have property tax, do not control hidden assets... then taxing inherited assets too early, too cold will easily create negative social reactions.
It is impossible to use the same tax mechanism for both speculation and inheritance. Land traders and ancestral land owners cannot be in the same tax net.
I think, if it is really necessary to tax inherited assets, it should be done at the time of receipt, not to focus all tax obligations at the time of transfer. And tax should be exempted or reduced for assets that are "only houses" and "household land" that have been used stably for many years.
The three core principles that need to be thoroughly grasped are: fairness - layered - transparent.
Fairness: Clearly distinguish between speculation and legitimate demand.
Decentralization: Taxes must reflect behavior, not equalize everything.
transparency: There must be a clear tax map, easy-to-reach lookup tools, avoiding "tax in the fog".
An effective tax policy does not lie in high or low revenue, but in people's belief in fairness and transparency in implementation.
