Inside the Carriage Repair Workshop (Gia Lam Railway Company). (Photo: AM)

Waiting for confirmation of land properties

The Government Office has just issued urgent Official Dispatch No. 5998/VPCP-DMDN to the ministries of Finance, Natural Resources and Environment, Transport (GTVT); Hanoi People's Committee and the State Capital Management Committee at Enterprises to convey the direction of Deputy Prime Minister Le Thanh Long regarding difficulties and problems in management and implementation of financial obligations at land lot No. 551 - Nguyen Van Cu (Long Bien District, Hanoi City).

This is the land area belonging to the Gia Lam Railway Company (a member unit of VNR), one of the two largest locomotive repair and carriage manufacturing factories in Vietnam today.

In the above dispatch, Deputy Prime Minister Le Thanh Long assigned the Hanoi People's Committee to consider VNR's proposal and opinions of relevant agencies to promptly handle and respond to VNR in August 2024.

The State Capital Management Committee at Enterprises (the managing unit) urgently reviews and has specific proposals for VNR's recommendations on handling difficulties in management, use and implementation of financial obligations at the real estate facility at 551 - Nguyen Van Cu.

On that basis, preside over and coordinate with relevant ministries, branches and Hanoi People's Committee to review and agree on how to handle problems in accordance with legal regulations and previous instructions of Government leaders.

“In case of any problems arising or exceeding its authority, the State Capital Management Committee at Enterprises shall report to the Prime Minister in the third quarter of 2024,” Deputy Prime Minister Le Thanh Long directed.

Previously, in mid-June 2024, VNR sent a document requesting the head of the Government to direct the Hanoi People's Committee, the Hanoi Department of Natural Resources and Environment, and relevant agencies to identify the entire land area at 551 - Nguyen Van Cu as railway industrial construction land, as confirmed by the Vietnam Railway Authority.

VNR also proposed that the Prime Minister consider resolving preferential and support policies in railway operations as prescribed in Point a, Clause 2, Article 6, Railway Law 2017, in accordance with Article 209, Land Law 2024 for the entire land area at No. 551 - Nguyen Van Cu.

Specifically, no land use fee will be collected for the land area of ​​122,973 m2 (which is the railway system and warehouses and workshops for repairing locomotives and carriages, which are identified as railway infrastructure and railway industrial works, and the common regulating lake of the area) from the time of Decision No. 6960/QD-UBND dated November 18, 2013 of the Hanoi People's Committee on leasing 203,873 m2 of land at 551 - Nguyen Van Cu to VNR until June 30, 2017 (before the 2017 Railway Law takes effect).

“While waiting for competent authorities to review legal procedures and financial obligations regarding land, the Hanoi People's Committee and the Ministry of Finance direct the tax authorities to continue to include the amount that the Corporation must fulfill its financial obligations for land lot No. 551 - Nguyen Van Cu in the group of 'tax arrears being processed' and not to calculate late payment fees at the above-mentioned house and land premises,” Mr. Dang Sy Manh, Chairman of the Board of Members of VNR proposed.

Hanging rack for processing

It should be added that the house and land at 551 Nguyen Van Cu was built by the French colonialists in 1905, and has a history closely linked to the construction and development of the Vietnamese railway industry. In April 1955, the General Department of Railways received and managed the land and assigned it to the Gia Lam Railway Factory (now the Gia Lam Railway Company) for use.

Since the takeover, the General Department of Railways and later, the successor unit VNR have continuously managed, operated and used all facilities at 551 - Nguyen Van Cu to serve industrial production, manufacturing and repairing locomotives and carriages.

In 1999, VNR signed a 10-year land lease contract with the Hanoi Department of Land Administration from January 1, 1996 for lot 551 - Nguyen Van Cu, with a rental price of VND 4,550/m2/year.

The total area for which VNR must pay land rent is 127,597 m2, after deducting the area of ​​20,721 m2 of the common regulating lake of the area and 56,270 m2 of land used for the railway infrastructure system, the area to ensure railway safety in the factory premises.

At this time, Gia Lam Railway Company (the direct management and use unit) has fully performed its land obligations according to the unit price.

In November 2013, the Hanoi People's Committee issued Decision No. 6960/QD-UBND to continue leasing 203,873 m2 of land at 551 Nguyen Van Cu to VNR, but the entire plot of land and construction works on this plot of land were determined to be for "construction of offices and business establishments".

Then, the Hanoi Department of Finance issued a unit price for the entire area of ​​203,873 m2 of land at 551 - Nguyen Van Cu at 368,276 VND/m2 (80.94 times higher than the old unit price).

“Although VNR still uses the above-mentioned land and housing facilities to serve the railway industry as it has since the takeover, the fact that the land area is no longer allocated as before has greatly affected the production and business efficiency of the unit,” said Mr. Dang Sy Manh.

It is known that in the period from November 18, 2013 to June 30, 2018 (before the 2017 Railway Law took effect), VNR temporarily paid land rent for an area of ​​80,900 m2 of land for office use and production, with an amount of VND 131 billion.

For the remaining area (122,973 m2 is the entire railway system, warehouses, workshops for locomotive and wagon repair, which are identified as railway infrastructure and railway industrial works and the general regulating lake of the area), VNR has not paid land rent with the amount of VND 194,409 billion. This amount does not include VND 101,754,664,124 that the Hanoi City Tax Department imposed a late tax payment penalty.

From July 1, 2018 to present, the total amount of financial obligations is 205,253 billion VND, late payment penalty is 19,143 billion VND.

Pursuant to Point a, Clause 2, Article 6 of the 2017 Railway Law and Article 2093 of the 2024 Land Law, VNR has not yet fulfilled its financial obligations for the entire above-mentioned land area.

It is known that over the past 3 years, the State Capital Management Committee at Enterprises and VNR have continuously sent written recommendations to the Government leaders and the Hanoi People's Committee to thoroughly handle difficulties and problems in the management, use and implementation of financial obligations for the house and land at 551 - Nguyen Van Cu.

Based on the direction of the Government leaders, the Ministry of Transport, the Vietnam Railway Authority has inspected the current status of use and confirmed that the house and land at 551 - Nguyen Van Cu is a complex of railway works, and at the same time requested the Hanoi People's Committee to consider and resolve according to regulations.

On January 16, 2024, the Office of the Hanoi People's Committee issued Document No. 715/VP-TNMT notifying the direction of Vice Chairman of the Hanoi People's Committee Nguyen Trong Dong to assign the Department of Natural Resources and Environment and the Hanoi Tax Department to consider and resolve the content of the proposal of the Vietnam Railway Authority, but to date, VNR has not yet received a resolution document.

"This leads to VNR's tax debt being suspended, with no final resolution, causing difficulties for the unit's production and business activities," VNR's leader informed.