Vietnam proposes 0.2% tax rate on abandoned land

The Ministry of Finance has proposed a new tax rate of 0.2% for unused or abandoned land in Vietnam. This proposed rate is significantly higher than the current 0.03% tax applied to residential land within quotas, representing a nearly sevenfold increase.

The proposal aims to implement Resolution 21 of the Central Committee to combat land waste and discourage real estate speculation. If passed by the National Assembly, this would be the first time “abandoned land” is formally defined and taxed as a specific category in the legal system.

Experts and lawmakers have expressed mixed reactions. While many support the move to prevent land hoarding, others warn of potential implementation challenges. Key concerns include the lack of clear legal criteria to distinguish between land that is truly abandoned and land that is temporarily vacant due to planning disputes, legal hurdles, or administrative delays. Some specialists suggest a pilot program in specific regions before a nationwide rollout to assess the impact on the real estate market and ensure the policy does not unfairly penalize legitimate landowners.