NDO - Personal income tax policy for real estate transfer activities is always a controversial topic when it must ensure budget revenue while avoiding creating a burden for the people. In particular, the current tax method is said to still have many shortcomings, leading to false declaration of transaction value, causing tax losses and distorting the market.
Taxation methods still have many shortcomings
According to the Ministry of Finance, in order for tax policy to properly reflect the nature of economic transactions, determining taxable income from real estate transfers should be based on the formula: tax rate multiplied by taxable income, in which taxable income is calculated by selling price minus total related costs.
The Ministry of Finance believes that it is necessary to study the option of regulating personal income tax from real estate transfer and land use rights transfer at a tax rate of 20% to create similarity with the corporate income tax rate from real estate transfer. However, to apply this method, two important conditions are needed: a database of land transaction history that accurately reflects the actual value and clear regulations on deductible expenses and conditions for proof as well as the cost price of the transferred real estate.
The problem is that, although the tax authority has had historical transaction data since 2018, the transfer price stated in the contract still does not reflect the actual value. Controlling to ensure that buyers and sellers declare honestly is still difficult. Meanwhile, collecting documents to prove transfer costs and capital costs is not simple.
Easily identifiable costs such as purchase, construction, and repair costs can be recorded, but expenses such as brokerage fees, interest, and compensation costs are difficult to prove. This creates a major obstacle in calculating the actual profit from real estate transactions. Especially in cases where real estate was purchased a long time ago, inherited, or gifted, the initial cost is almost impossible to determine.
Sharing about this issue, economist Nguyen Tri Hieu said that one of the reasons why Vietnam's real estate market is distorted is that real estate taxes have not been effectively applied. Currently, real estate-related taxes mainly include non-agricultural land use tax, personal income tax from transfers and registration fees. Meanwhile, many developed countries such as the US, Japan or South Korea all apply annual property taxes on real estate values, helping to regulate the market and create a sustainable source of revenue for the state budget.
The lack of a reasonable real estate tax system has led to speculation and hoarding, causing real estate prices to rise beyond the reach of those with real needs. Without tax pressure, many investors are willing to "hoard" instead of putting real estate into transactions or exploitation. This reduces supply, pushes up prices and creates an unhealthy market. At the same time, the state also misses out on important sources of revenue, while still having to rely heavily on corporate income tax and value-added tax.
Therefore, according to Mr. Nguyen Tri Hieu, reforming real estate tax policy is necessary to limit speculation. One of the solutions that can be considered is to impose a progressive tax on second and more properties. This method both controls the hoarding situation and does not affect home buyers. In addition, there should be a policy of tax exemption and reduction for social housing and low-income housing to ensure access to housing for vulnerable groups; at the same time, tax collection should be decentralized to local authorities, helping to create a budget source for infrastructure development and public services in urban areas.
Tighten management and connect tax data
Analyzing the shortcomings of the current personal income tax policy, expert Phan Huu Nghi, Deputy Director of the Institute of Banking and Finance (National Economics University) pointed out that there are currently two methods of calculating tax: the first method is a 2% tax on the total transaction value, the second method is a 20% tax on the difference between the purchase price and the sale price.
The first method, although simple, creates a big loophole when many people deliberately declare lower prices than the actual price to reduce taxes. This not only causes budget loss but also makes the market less transparent.
In contrast, the second method, which imposes a 20% tax on the difference between the buying and selling prices, more accurately reflects the actual profit but has difficulty determining the cost price, especially for transactions that occurred many years ago.
To overcome this situation, Mr. Phan Huu Nghi proposed that it is necessary to tighten the management of price declaration, ensuring that the transaction value is recorded correctly. Then, if the buyer intentionally records a low price to avoid tax, they will have difficulty reselling, because the purchase price recorded on the documents is too low, which can cause the tax payable in the following transaction to be higher. In addition, it is necessary to apply strong sanctions to cases of false declaration of transaction value to create transparency in the market.
Another important solution is to implement data interconnection between notary, tax and land management agencies to better control transaction values.
According to Mr. Nghi, if there is a transparent data system, the state can compare market prices to detect cases of lower declarations than reality. At the same time, it is necessary to study and supplement legal regulations to determine reasonable expenses when calculating taxable income, avoiding the situation where taxpayers have difficulty proving actual expenses.
In general, the reform of personal income tax from real estate transfers needs to ensure two goals: increasing transparency, avoiding tax losses, and creating conditions for stable market development. Accordingly, there needs to be adjustments so that taxes reflect actual profits, limiting the situation of "two prices" in real estate transactions.
However, the implementation needs to have a reasonable roadmap, avoid sudden disruptions and ensure the rights of those who have a real need to buy houses. Because real estate tax reform is not only a financial issue but also related to the sustainable development of the market.
If implemented properly, personal income tax will help reduce speculation, stabilize real estate prices and create a stable source of revenue for the budget, instead of relying too much on other taxes. Most importantly, tax policy needs to be placed in a synchronous management ecosystem, from controlling price declarations, verifying transactions to building a transparent database, to ensure fairness for buyers, sellers and the State.
Source: https://nhandan.vn/tao-su-minh-bach-va-bao-dam-quyen-tiep-can-dat-dai-post865655.html
Comment (0)