According to the first week of November report of the Vietnam Association of Realtors (VARS), many businesses have projects that cannot be implemented due to "blockage" in calculating land use fees. Many projects have even been completed but cannot be sold because they have to wait for the completion of financial obligations related to land use fees, due to difficulties in determining land prices.
Evidence from the past shows that many enterprises could not fulfill their financial obligations to the State due to unforeseen increases in land use fees. Many enterprises that have completed projects and handed them over to the people have faced “huge” financial costs when the provincial and municipal People’s Committees reviewed land use fees.
Previously, these projects were temporarily calculated by the Provincial and City People's Committees so that businesses could implement project construction.
According to Mr. Le Dinh Chung - General Director of SGO Homes, the market is facing a number of issues regarding financial obligations related to project land, including land use fees, land rent; taxes, fees, and charges related to land.
Firstly, in some localities that have approved the price to determine financial obligations related to land, the price offered is considered relatively high.
Second, for some real estate markets that have not yet recovered, it is unreasonable to use input data to determine land prices in the last 2 years, which may coincide with the time when the real estate market is still in a feverish phase. This will easily lead to determining land prices that are not consistent with the current actual situation.
Third, errors in price appraisal have caused losses to the state budget in recent times, causing local officials to be afraid of making mistakes, of responsibility, and of legal risks. To be “safe” in valuation and avoid the risk of being held accountable later, local officials often choose to approve land prices at high levels or delay approval.
Therefore, projects that have had their land prices approved early are often much higher than the ground level, causing the project's business efficiency to be low, even at risk of loss. Meanwhile, projects that have not had their land prices determined are stalled and behind schedule.
“To resolve this situation, I think that the state management agency needs to soon issue a document guiding the appraisal of prices according to the new land price list. It is necessary to specify in detail the time of determining land prices, projects formed before which stage will be applied the old price frame. And projects approved from which time will apply the new land price list” - Mr. Chung shared.
Mr. Nguyen Van Loi - Director of Dat Vang Hai Duong Real Estate Joint Stock Company, member of the VARS Market Research Working Group - also recommended that the State should review and recalculate land use fees for projects that have been approved for land use fees, which businesses have reported as having unreasonable calculation times and methods.
At the same time, exempt late payment penalties for enterprises if there is a conclusion that the above projects are not priced reasonably. For new projects that are completing approval procedures and have not paid land use fees, the State management agency should finalize the time and calculation method with enterprises so that enterprises can calculate the costs and efficiency of the project when implementing.
