According to you, should we tax the second property at the present time?
- Overall, I think that applying a progressive tax rate to people who own many houses and lands is necessary.However, when to apply it and how to tax it appropriately are things we need to study carefully.
Firstly, applying a higher tax rate to people who own many houses and lands has been set out in Resolution No. 18/2022 of the Central Executive Committee.
Second, regarding the timing factor, Vietnam is in the post-COVID-19 economic recovery phase. Production and business activities of enterprises and people are still facing difficulties. Applying taxes to people who own many houses and lands may have a certain impact on the recovery ability.
On the other hand, the database and information system on the real estate market in our country is not really complete and perfect. Our country has not yet digitized and "attributed" the number of real estates that people actually own nationwide. Information on real estate transfer value is not transparent when the situation of "two-price" land transactions is quite common. That context raises the question of whether the immediate application of progressive tax to real estate owners is really effective and whether it is "correct" or "correct" is something that needs to be studied and evaluated comprehensively.
Third, it is necessary to study the method of taxation. Currently, our tax and fee policy system has "covered" the entire process from establishing ownership, right to use and transfer of real estate.
When granted a land use right certificate, people must pay land use fees at different rates, depending on the specific case and time of land use as prescribed in the 2024 Land Law. During the exploitation process, land users must pay non-agricultural land use tax (tax rate is 0.03%/year). When transferring, they must pay personal income tax (2%/transfer value).
Therefore, the tax regulations for people who own many real estates need to be carefully studied and evaluated, and linked to the adjustment of the tax, fee, and charge levels that land and real estate users are paying to avoid "tax on tax". Therefore, in the current period, the application of progressive tax for people who own many real estates can be considered, studied, and evaluated comprehensively.
In my opinion, to have a basis to fully assess the impact of this factor, the National Assembly can apply the progressive tax regulation in the form of a pilot Resolution for a certain period of time (for example, from 3 to 5 years). After the pilot application, we will have a review and evaluation mechanism. If it is really mature, the National Assembly will promulgate it into law and apply it stably and permanently.
Is taxation the most important solution today to help the real estate market develop sustainably?
- Applying this tool independently may not be effective, it is not a "magic wand" to create sustainable development for the market.
With the current real estate market in our country, due to lack of supply (supply is less than demand) and many projects facing legal problems. Many localities are "afraid of making mistakes" leading to projects being stuck without completing legal procedures to open for sale. The transparency of the real estate market in general, and land in particular, is still too low; data digitization is not complete.
Therefore, the immediate solution is to accelerate the digitization process and build a land database, "removing" legal obstacles for "shelved" projects. This is an urgent issue at this stage.
Thank you!
