1. Households engaged in agricultural and forestry production and aquaculture (collectively referred to as households paying agricultural land use tax) in the flood-stricken areas shall be considered for reduction or exemption of agricultural land use tax for each year or each crop affected by natural disasters as stipulated in Article 17, Chapter V of Decree No. 74/CP of October 25, 1993 of the Government detailing the implementation of the Law on Agricultural Land Use Tax. In case of heavy damage, they shall also enjoy agricultural land use tax reduction or exemption as follows:

a/ Agricultural production households in the flood-stricken areas which meet with many difficulties in life and activities and are classed hungry ones to be succored by the State shall be eligible for one-year agricultural land tax exemption.

b/ Households that suffer heavy damage in properties such as their houses are destroyed or more than 40% damaged, their bovine animals are lost, or their other main production implements are heavily damaged, lost or washed away by the flood, are eligible for agricultural land use tax exemption according to Item a above, and for the year following the flood year so that they can stabilize their life.

c/ Family households in the flood areas that have their parents or spouses or children (in the same household) killed or reported missing (one or more persons), seriously injured and requiring prolonged medical treatment shall be exempted from agricultural land use tax for one year. If they have been exempted from tax as stipulated in Item a above, they shall also be considered for tax reduction or exemption in the subsequent year.

d/ Households engaged in agricultural and forestry production and aquaculture (including enterprises) in the flood areas that have their fields or gardens or land for aquaculture, or land under planted forests that suffer from landslide caused by the flood or filled up by soil and sand and have to invest in revamping the fields, the system of field embankments and irrigation canals and ditches, shall be exempted from agricultural land use tax for one year for the affected areas. If these areas cannot be restored to stable production in the subsequent year and need more investment in further, they are eligible for tax exemption, or reduction in that year.

2. Maximum reduction by 80% of agricultural land use tax for one year for the following households:

a/ Agricultural production households (including enterprises) in the flood areas that have their properties damaged such as houses damaged by less than 40% and a number of main production means damaged or lost that require investment in reprocurement.

b/ Agricultural production households in the flood areas having their rice fields or subsidiary crop land, trees, reared aquatic products damaged (including paddy, subsidiary crops pending harvest and having to switch to other crops or having been brought home but submerged in water, or being mingled with soil, sand and pebble or having germinated or otherwise damaged). They shall, depending on the extent of the damage of each kind of crop, be considered for agricultural land use tax reduction according to stipulations in Article 17, Chapter V of Decree No. 74/CP of October 25, 1993 of the Government detailing implementation of the law on agricultural land use tax.

3. The consideration for tax exemption or reduction for agricultural production households in Points 1 and 2, Section I of this Circular shall be carried out right in the crop or year of the flood.

4. The amount of tax exempted or reduced under the social policies (if any) plus the amount of tax exempted or reduced due to the flood in a year shall not exceed the tax recorded in the tax register of the year when the exemption or reduction is considered.

5. If the subjects in the category eligible for agricultural land use tax exemption or reduction stipulated above in the flood year have paid the tax into the State budget, the tax which is exempted or reduced shall be cleared against the tax to be paid in the years following the flood year.

Annual exemption or reduction of agricultural land use tax for agricultural production households being beneficiaries of social policies has been concretely stipulated in Article 16, Chapter V of Decree No. 74/CP of October 25, 1993 of the Government detailing the implementation of the Law on Agricultural Land Use Tax and concrete guidance in Points 2a, 2b, Section I of Circular No. 60/TC/TCT of July 14, 1994 of the Ministry of Finance providing additional guidance for the reduction or exemption of agricultural land use tax. Now the Ministry of Finance provides the following further guidance on the reduction or exemption according to the social policy:

1. With regard to the communes under the program now implementing Decision No. 135/1998/QD-TTg of July 31, 1998 and Decision No. 1232/QD-TTg of December 24, 1999 of the Prime Minister on the program for socio-economic development of the communes with great difficulties, the mountainous, deep-lying and remote regions;

a/ The agricultural production households enjoying annual exemption of agricultural land use tax include:

Agricultural production households, which are meeting with difficulties in their production and life and recognized as hunger-stricken or poor families in the locality (except those households which are rated well-off and have a stable life).

Agricultural production households, which are families of war invalids, sick soldiers or fallen heroes, families having made meritorious services to the revolution and are classed as households meeting with many difficulties in production and life.

Agricultural production households, which are families of soldiers, young volunteers, former resistance war activists and other households that are recognized by the commune administration to have their children affected by aftermath of the war such as mental diseases, paralysis, loss of working capability, etc.

b/ Maximum reduction by 50% of agricultural land use tax for agricultural production households in the category stipulated in Item a above which though not yet in the category eligible for tax exemption are meeting many difficulties in agricultural production and life such as large number of children, suffering from risks in production and unable to make both ends meet, classed in the category of poor households in the locality.

2. With regard to the communes in the other areas in the whole country:

a/ Agricultural production households enjoying annual exemption of agricultural land use tax include:

Agricultural production households recognized as hunger-stricken households in the locality.

Family households of soldiers, volunteer youths, resistance war activists and other households recognized by the commune administration as having their children affected by the aftermath of war such as mental diseases, paralysis, loss of working capability, etc. and meeting with many difficulties in production and life.

Agricultural production households that are families of war invalids, sick soldiers, fallen heroes, families having made meritorious services to the revolution, families that are rated as poor households still meeting with many difficulties in production and life.

b/ Maximum reduction by 50% of agricultural land use tax for the subjects defined in Item a, Point 2 above but not yet eligible for consideration for tax exemption.

c/ Reduction of agricultural land use tax for the agricultural production households in the area of specialized production of farm produce, forest products and aquatic products under contract or according to the regional planning in order to supply raw materials for the concentrated processing establishments which suffer damage due to objective factors such as: steep drop of market prices, income from sales of agricultural produce not enough to cover production costs, delayed harvest that affects the following crop and had to be destroyed. The rate of reduction or exemption of tax shall correspond with the rate of damage stipulated in Article 17, Chapter V of Decree No. 74/CP of October 25, 1993 of the Government detailing the implementation of the Law on Agricultural Land Use Tax. The rate of damage shall be based on the real harvest output and the real selling price compared to the real output calculated according to the fixed price prescribed by the provincial People�s Committee.

1. Basing itself on the list of the communes meeting with great difficulties announced together with Decision No. 1232/QD-TTg of December 24, 1999 of the Prime Minister, and the actual situation in each locality, the People�s Committee of the province or centrally-run city shall make public the concrete list of the communes with great difficulties and the border communes in the locality under its management, at the same time shall provide concretely for the criteria to determine the poor households, hunger-stricken households, households whose production and life still meet with many difficulties as basis to consider the annual reduction or exemption of agricultural land use tax.

2. Agricultural production households in the category eligible for consideration for reduction or exemption of agricultural land use tax shall have to send an application to the commune or ward tax office, in which they shall explain the reason to apply for tax exemption or reduction under the criteria stipulated by the People�s Committee of the province or centrally-run city concerning the deep-lying, remote communes and the hunger-stricken and poor households.

As for the storm and flood stricken areas where the agricultural production households suffer heavy losses and the communes meet with great difficulties and are eligible for uniform exemption or reduction of tax, the ward or commune tax office shall coordinate with the commune People�s Committee to draw up the list instead of separate application filed by each agricultural production household.

3. Process and procedures of tax exemption or reduction:

a/ At the commune or ward: The Tax Office and the Tax Consultancy Board shall base themselves on the application of the agricultural production households, the situation and level of damage caused by flood, and the situation of production and life of each agricultural production household in the commune or ward to select, classify and draw up the list and propose the level of tax exemption or reduction for the poor and hunger-stricken households, the households which are meeting with many difficulties in production in the commune or ward according to the criteria prescribed by the People�s Committee of the province or city and in this Circular. The list of agricultural production households eligible for agricultural land use tax exemption or reduction shall be posted up at the convenient place in the commune and notified to the people so that they may make suggestions. Within 15 days, after studying and accepting the suggestion of the people, the tax office shall report to the People�s Committee of the commune or ward for approval of each household enjoying agricultural land use tax exemption or reduction, ensuring right objects and the stipulated amount of exempted or reduced tax and send the list to the Tax Sub-department.

b/ The Tax Sub-department in coordination with the Tax Consultancy Board at district level (or equivalent) shall base itself on the stipulations of the State and the People�s Committee of the province or centrally run city to check the accuracy and legality of the list of households proposed by the commune level for reduction or exemption of agricultural land use tax and integrate them to report to the Tax Department.

c/ The Tax Department concerned in coordination with the concerned branches shall examine the extents of the real damage caused by flood in each region, the real situation of the poor and hunger-stricken households and the households meeting with many difficulties in production and life in order to report to the People�s Committee of the province or city for decision on exemption or reduction of agricultural land use tax.

d/ After the People�s Committee of the province or city has decided to exempt or reduce tax, the approved list of the agricultural production households eligible for tax exemption or reduction shall be posted up at the office of the People�s Committee of the commune and publicly and promptly announced to each tax paying household.

1. The president of the People�s Committee of the province shall have to direct the tax office and related branches in the locality to study and concretely set the criteria to determine the hunger stricken and poor households and the agricultural production households meeting with many difficulties, as basis for the timely approval of the agricultural land use tax in the locality for the right objects, direct and inspect the implementation by the specialized agencies of agricultural land use tax exemption or reduction and shall notify publicly and promptly to the households eligible for tax exemption or reduction; direct the information and propaganda agencies in the locality to popularize and explain the policy of agricultural land use tax exemption and reduction of the State for the people to understand and implement.

2. The tax office in coordination with the branches and the Tax Consultancy Board shall give advices to the People�s Committee of various levels in determining the agricultural land use tax exemption and reduction.

In the areas heavily damaged by storms and floods where tax exemption or reduction has to be carried out uniformly, the tax team of the ward and commune shall coordinate with the specialized branches in drawing up the list and dossiers of eligible households and determine the exempted or reduced tax amount of each household, then integrate them into a report to the People�s Committee of the ward or commune in order to issue a public notification to each village or hamlet.

In lightly affected hamlets or communes or where only a small number of households are affected and there are only a small number of sporadic households that are poor or hunger-stricken or meeting with many difficulties in life and production, the Tax Office in coordination with the local administration shall guide the tax paying households in making applications and compile dossier of each household as basis for the consideration of tax exemption or reduction as stipulated in this Circular.

3. This Circular takes effect after its signing. The stipulations on agricultural land use tax exemption or reduction which are not contrary to this Circular continue to be effective. In the course of implementation should any difficulty arises, the localities shall report to the Ministry of Finance for study and settlement.

For the Minister of Finance
Vice Minister
VU VAN NINH