Reducing land rent creates resources to contribute to growth targets

The task is extremely heavy. Deputy Prime Minister Nguyen Hoa Binh directed: "We must "accelerate and break through" to achieve the socio-economic development goals of 2025 and the entire 2021-2025 term, creating a premise to implement the socio-economic development plan for the 2026-2030 period". Many solutions have been deployed by the Government since the beginning of the year and received consensus and positive response from the business community.

Recently, through the Vietnam Federation of Commerce and Industry (VCCI), many businesses and associations proposed that the Ministry of Finance and the Government reduce 30% of the land rent payable; thereby helping businesses reduce financial burdens, increase their ability to respond to global economic risks and contribute to the country's 8% growth target. Mr. Dau Anh Tuan, Deputy General Secretary, Head of the Legal Department (VCCI) expressed his opinion, agreeing with the plan to build a policy to reduce land rent in 2025 proposed by the Ministry of Finance and commented that this policy is consistent with the Government's determination to achieve an economic growth rate of 8% in 2025, aiming to create momentum for the 2026 - 2030 period of double-digit growth. The private economy is contributing nearly half of the national GDP and will be the main driving force in economic growth, therefore, the State should have policies to support businesses to make breakthroughs in production and investment, especially in the context of economic forecasts in 2025 with many difficulties.

"This year, exports are expected to face many challenges, while inflationary pressure and production material costs are increasing due to supply chain disruptions," said Mr. Dau Anh Tuan. In fact, the land rent reduction policy has also been applied over the years from 2020-2024. On average, each year, land and water surface rents are reduced by about VND3,000-4,000 billion. The reduction rate as in previous years of 30% is also reasonable and should continue through 2025. A 30% reduction in land rent helps businesses have more resources to restore production and business, but is still within limits, not significantly affecting the total state budget revenue.

Through approaching and understanding the needs of many businesses, Ms. Dang Thi Sinh, General Director of 24h Real Estate Investment Joint Stock Company, said that the demand for land and factory construction is always high. In 2024 and 2025, businesses have not yet "reduced" their difficulties because they are greatly affected by the fluctuations of the financial and economic crisis in the country and the world. In order to maintain existence and accumulate finance for long-term investment plans, creating momentum and resilience for businesses to grow in the coming period, the policy of continuing to reduce 30% of the annual land rent payable by businesses is very necessary and timely. However, it is necessary to choose the right subjects to ensure social fairness and businesses, no matter how small, will benefit. This is very important, because the support policy is for difficult cases. The leveling situation sometimes not only causes dissatisfaction but also damages the country's financial resources.

From the business reality, Mr. Pham Hai Long, General Director of Agrex Saigon Company said that currently, the market is still facing many difficulties, there are not many orders while the burden of input costs and interest rates is still making businesses "struggling" to bear. Businesses really need to be supported with practical policies to overcome the current temporary challenges and stabilize production. Businesses recommend continuing to maintain support policies such as exemption and reduction of land rent, water surface rent or extension of payment deadlines for VAT, corporate income tax, personal income tax, etc.

In the context of many difficulties in production and export, for many businesses, annual land and water surface rental costs account for a large proportion of the total costs of the business. Just a 30% reduction in land rental costs is very valuable and appreciated, helping to reduce financial pressure for businesses.