Originally published March 15, 2011
Keywords: land use fees, Vietnam, Decree 198, Decree 120
On 30 December 2010, the Vietnamese Government issued Decree No. 120/2010/ND-CP (Decree 120) to amend a number of articles of Decree No. 198/2004/ND-CP on collection of land use fees (Decree 198).
The salient provisions of Decree 120 are presented below.
Recording land use fees as a debt
Under Decree 120, households and individuals that are allocated land by the State for resettlement but cannot afford to promptly pay land use fees may have such unpaid amounts recorded as a debt owed to the State in their land use right certificates. They will have to pay these debts within five years on an amortisation basis. In cases where payment is made after the term, these land users must pay land use fees in accordance with the price computed at the time of payment.
Under Decree 198, the above entities were not allowed to have the land use fees recorded as a debt on their land use right certificates.
Supplement of land use fee exemption cases
Under Decree 198, land use fees were exempted in the following cases:
- land for construction of students' dormitories
- land for construction of dwelling houses for displaced people due to natural calamities
- land for construction of dwelling houses of ethnic minority people in areas facing exceptionally difficult socio-economic conditions
Decree 120 now prescribes more cases eligible for such exemption:
- land for construction of dwelling houses for sale (on a lump sum or instalment basis), for rent or for lease-purchase by low-incomers in urban areas
- land allocated to be used as hydroelectric reservoir bed
Reduction of land use fees
Decree 120 also sets out cases where reduction of land use fees applies. Ethnic minority families and poor households may be entitled to 50% reduction of such fees.
Decree 120 took effect from 1 March 2011.
Visit us at www.mayerbrown.com
Copyright 2011. JSM, Mayer Brown International LLP and/or Mayer Brown LLP. All rights reserved. Mayer Brown is a global legal services organization comprising legal practices that are separate entities ("Mayer Brown Practices"). The Mayer Brown Practices are: JSM, a Hong Kong partnership, and its associated entities in Asia; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales; and Mayer Brown LLP, a limited liability partnership established in the United States. The Mayer Brown Practices are known as Mayer Brown JSM in Asia.
This article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein. Please also read the JSM legal publications Disclaimer.