The Ministry of Finance has proposed a series of policies on taxes and fees to support people and businesses. The first policy is to propose a 30% reduction in land and water surface rents.
The National Assembly issued Resolution No. 192 on supplementing the 2025 Socio-Economic Development Plan with a growth target of 8% or more. Previously, the Government also issued Resolution No. 25, a separate resolution issued for the first time on the growth target of 12 sectors and fields and 63 localities in 1 year. This demonstrates the Government’s highest determination to strive for GDP growth of 8% or more this year.
Recently, the Ministry of Finance has proposed a series of tax and fee policies to support people and businesses. The first policy is to propose a 30% reduction in land and water surface rents in 2025. This is not the first year this policy has been proposed. Previously, the land rent reduction policy was implemented from 2020 to 2024, directly supporting tens of thousands of billions of VND for people and businesses and having a positive impact on the recovery of the economy during and after the Covid-19 pandemic.
The factory is large, the workers are numerous, and the raw materials must be imported, which means that the capital required is also large. “A piece of food when hungry is worth a package when full”. The policy of reducing land rent by 30% is not too much, but businesses believe that in the context of mechanical enterprises being affected by the new US tariff policy, any support, no matter how small, is valuable.
Mr. Pham Viet Long – Deputy General Director of Dong Anh Licogi Mechanical Joint Stock Company said: “This is a practical policy and especially if it continues to be applied in 2025, the efficiency will be much higher than before. Firstly, businesses will reduce a source of costs with such an amount, although not large but it is a source of motivation to encourage businesses. Secondly, it increases the competitiveness of businesses, with that source we can invest more in improving product quality and launching new products”.
As a company that is building industrial parks and implementing green power projects, Vinadic is having to rent hundreds of hectares of land. The reduction in land rent in recent years has directly supported the company with a significant amount of money.
“Use that exemption money to reinvest and expand production scale. Our business benefits from the Government’s policies. In 2024 and 2025, we will expand production scale, creating dual benefits between businesses and the State, leading to ensuring overall economic development as required by the Prime Minister, which is 8% growth. Creating more jobs for workers, promoting social development”, said Mr. Nguyen Hoai Giang – General Director of Vietnam Construction Investment Development Joint Stock Company.
Mr. Nguyen Van Phung, former Director of the Large Enterprise Tax Department, General Department of Taxation said: “Looking at the figure of 30%, it is still the same as every year, but looking at the absolute figure, it will be higher. Because the land rental price this year is higher than previous years due to fluctuations after the Land Law took effect. I think the proposal to reduce by 30% is appropriate, if there are conditions, it would be better to reduce it further. However, we also take into account the tolerance of local budgets.”
If the proposal to reduce land rent by 30% is approved, it is expected that this year businesses and people will save about 4,000 billion VND. This is a valuable source of support for them to cut costs, creating momentum for economic growth.
Proposal to exempt land rent for agricultural projects
Not only proposing a 30% reduction in land and water surface rents in 2025, recently in the draft Decree of the Government stipulating cases of exemption and reduction of land use fees and land rents according to the provisions of the Land Law, the Ministry of Finance has proposed exempting land rents for up to 15 years for agricultural investment projects.
Specifically, agricultural projects with investment incentives and agricultural projects that encourage investment will be exempted from land rent during the entire construction period. After this time, agricultural projects with investment incentives will continue to be exempted from land rent for 15 years and have their rent reduced by 50% for the next 7 years. Meanwhile, agricultural projects that encourage investment will be exempted from land rent for an additional 11 years and have their rent reduced by 50% for the next 5 years.
Mr. Nguyen Tan Thinh – Director of the Department of Public Asset Management, Ministry of Finance said:
“We also based on the proposals of ministries, branches, localities and on the basis of inheriting Decree 57 currently of the Government, the agricultural and rural areas are of great concern to the Party and State. Therefore, with this decree, the regulations on exemptions and reductions will be longer than other common fields in the same area or with the same level of investment incentives.”
2024 is also a breakthrough year for Vietnamese agriculture when the export turnover of agricultural, forestry and fishery products reaches over 62 billion USD, an increase of 18%. Therefore, experts believe that the exemption of agricultural land use tax will have a great impact, helping to encourage organizations, individuals and businesses to stick with the fields and invest in effective agricultural production.
The Ministry of Finance is also seeking comments on a draft decree extending the deadline for payment of value-added tax, corporate income tax, personal income tax and land rent in 2025. When the Decree is issued, this will be the 6th time businesses and people have benefited from this policy since 2020.
It is expected that the total amount of tax to be extended in 2025 will be nearly 102,000 billion VND. The subjects of extension will be the same as in 2024. It is expected that businesses and people will be extended for value added tax, corporate income tax and land rent from 5-6 months depending on the type of tax.
With the results achieved by people and businesses in recent years, along with the close direction of the Party and State, the tax and fee support policies in 2025 are expected to create momentum for the economy this year and the next period, in line with the direction in the recent resolution of the National Assembly and the Government.