Government proposes more agricultural tax exemption

Accordingly, 93,917 hectares of farming land and 77,136 tax payers are expected to enjoy tax exemption.

According to Resolution No. 55/2010/QH12, almost all farming land users have enjoyed tax exemptions or a 50 percent tax reduction.

More than 10.2 million hectares or 38 percent of the country’s total agricultural land are entitled to agricultural land use tax in line with the Law on Agricultural Land Use Tax. Of which, 68 percent are subject to tax exemption and reduction under the resolution.

The exemption and reduction aim to help farmers re-invest in agricultural production as well as scientific and technological applications in order to churn out higher quality products and raise productivity.

The draft resolution suggested further tax reductions and exemptions for farming land users, cutting the amount collected from agricultural land use tax from nearly VND61.1 billion (US$2.7 million) to VND5.7 billion (US$257,000).

Accordingly, 93,917 hectares of farming land and 77,136 tax payers are expected to enjoy tax exemption.

The majority of opinions of the National Assembly’s Committee for Finance and Budget agreed with the Government’s report when verifying it, saying the tax exemption will help accelerate the effectuation of Party and State policies on rural areas, agriculture and farmers.

The annual tax exemption for agricultural land use is worth just VND34.3 billion (US$1.5 million) which will not exert significant impacts on State budget collection, they said.

The committee underlined the need to set forth more preferential policies to encourage different economic sectors to invest in agricultural production and business.

The committee’s members shared the view that tax exemption will contribute to improving the competitiveness of the sector in the time ahead in the context of international integration.

They also agreed with the Government’s proposal to expand the date for tax exemption for additional subjects to December 31, 2020 in order to create a stable legal basis and demonstrate the consistent policy on rural areas, agriculture and farmers of the Party and State.

The committee urged the Government to instruct ministries, agencies and localities to seriously observe the Land Law and build a roadmap on addressing the use of agricultural land for ill purposes.