Recently, in a report sent to the Office of the Government on the reasons for the increase in real estate prices, the Ministry of Construction said it would study and propose a tax policy for cases of owning and using many houses and lands to limit speculation, buying and selling in a short period to make a profit.
In the context of the Vietnamese real estate market undergoing many fluctuations, the proposal to impose a progressive tax on individuals who own many houses and lands is attracting much attention.
Ms. Do Thu Hang - Senior Director, Research and Consulting Department, Savills Hanoi - acknowledged that applying a second real estate tax requires comprehensive preparation, not only in a specific area but nationwide.
Accordingly, there needs to be synchronization in the real estate management system and other technical measures such as banking transactions and asset declaration. Specifically, there needs to be accurate data on how many properties a person owns and a clear understanding of the purpose of buying a house for living or investment in order to tax appropriately. If there are not enough conditions, the implementation will not be effective and may harm the goal of healthy market development.
"Taxation requires time and planning, it cannot be done immediately. The timing of application needs to ensure sustainable market development for the economy to be stable," Ms. Hang emphasized.
Professor Dang Hung Vo - former Deputy Minister of Natural Resources and Environment - commented that a suitable tax is only a necessary condition, the sufficient condition is to be successfully implemented in practice. In Vietnam, this is a challenge because the real estate management infrastructure of our country is still relatively weak.
Accordingly, it is necessary to build a land management infrastructure, connecting provincial administrative units to track the number of real estate owned by an individual, avoiding under-declaration or incorrect declaration to avoid paying taxes. In our country, there is an electronic identification account system, which can conduct inventory and manage land ownership through this identification system.
Besides, we must manage the income issue. Currently, income from salary has been controlled quite well, but we still cannot grasp non-salary income, irregular income, and income from informal sources.
In case the income management system cannot be completed, there must be additional measures such as requiring an explanation of the source of funds for purchasing real estate and preventing the owner from transferring the name to another person in different forms to avoid tax or reduce the tax payable.
Accordingly, there must be a consensus among the whole society about the level of publicity and transparency of each individual's real estate ownership, creating a basis for developing a reasonable monitoring method. This is a huge difficulty in thinking about ensuring the right to privacy of property and the need for publicity to prevent corruption, including the right of people to monitor.
"Step by step, we need to change the concept of ensuring property privacy to replace it with mandatory disclosure and transparency of real estate assets, along with a mandatory explanation of the source of money to buy or build real estate," emphasized Professor Dang Hung Vo.
