Why are businesses in Tra Noc Industrial Park not entitled to land rent reduction?

Enterprises in Tra Noc Industrial Park, Can Tho city are not allowed to reduce land rent - Photo: LE DAN

On August 20, a leader of the Can Tho City Tax Department said that he had just reported to the City People's Committee on instructions for considering and resolving the petition of the Can Tho City Business Association on reducing land rent for 2023.

Accordingly, in accordance with the provisions of Decision No. 25/2023 of the Prime Minister on reducing land rent in 2023, the Can Tho City Tax Department only considers reducing land rent for cases where the State is directly leasing land according to the provisions of the law on land in the form of annual land lease payment.

Individuals and units that sublease land in industrial zones are not directly leased land by the State according to the provisions of the law on land, so they are not under the jurisdiction of the City Tax Department.

Can Tho City Tax Department has also resolved to reduce land rent for 2023 for Can Tho Industrial Park Infrastructure Construction Joint Stock Company (CIPCO). The consideration of reducing land rent for individuals and units signing land lease contracts with CIPCO is under the authority and responsibility of CIPCO.

However, according to the Can Tho City Business Association, in January 2024, CIPCO sent an official dispatch responding to the reduction of land rent according to the Prime Minister's decision.

Accordingly, CIPCO cannot apply the land rent reduction policy for 2021, 2022 and 2023 according to the Prime Minister's decision for land sublease contracts signed between CIPCO and enterprises subleasing land at Tra Noc 1 and Tra Noc 2 Industrial Parks.

A leader of the Can Tho City Business Association said that businesses leasing land in industrial parks without a 30% reduction in land rent is a huge disadvantage for businesses.

Because CIPCO is the primary land lessee, enterprises in the industrial park are secondary land lessees, directly putting the land into production and business.

While CIPCO is still exempted from 30% of land rent, enterprises that sublease land do not enjoy the same policy, and CIPCO should have reduced the same amount for units that sublease land.

Can Tho Industrial Park Infrastructure Construction Joint Stock Company is the investor of Tra Noc 1 and Tra Noc 2 Industrial Parks - Photo: LE DAN

Enterprises subleasing land are not entitled to rent reduction.

Speaking to Tuoi Tre Online , Mr. Truong Van Tien - Head of CIPCO's Planning and Business Development Department - said that after the Prime Minister issued a decision to reduce land rent, CIPCO immediately sent a document to the authorities of Can Tho city asking for procedural instructions, in order to apply the State's policy to reduce land rent for enterprises in Tra Noc 1 and Tra Noc 2 Industrial Parks.

However, according to the Ministry of Finance's official dispatch, CIPCO's leasing of land in industrial parks to enterprises is based on a civil agreement between the parties. Enterprises leasing land in industrial parks are not subject to land rent reduction according to the Prime Minister's decision.

Therefore, CIPCO cannot reduce land rent for enterprises in Tra Noc 1 and Tra Noc 2 Industrial Parks.

“In 2023, the Can Tho City Tax Department reduced 30% of land rent for CIPCO, which is 1.9 billion. If divided among 200 businesses operating in Tra Noc 1 and Tra Noc 2 Industrial Parks, this number is too small,” said Mr. Tien.

Source: https://tuoitre.vn/vi-sao-doanh-nghiep-tai-khu-cong-nghiep-tra-noc-khong-duoc-giam-tien-thue-dat-20240820164519665.htm