Hanoi(VNS/VNA) - Organisations and individuals buying, selling and transferringreal estate under two separate prices, meaning that the actual purchase priceis lower than that on the notarised contract, is increasingly common and hascaused great losses of revenue to the State budget.

The taxindustry has implemented many solutions, recommending that taxpayers need to behonest in declaring actual prices to protect their own interests.

In real estatetransfer activities, there are still cases in which the house prices declaredon real estate transfer contracts with notarised certification, are much lowerthan the actual prices.

There are alsocontracts of purchase and sale of houses and construction works which areformed in the future. The value of the future house is somehow equal to thepurchase price of the initial investor. In other case, after receiving thecertificate of land use right, when the ownership of house and otherland-attached assets has been granted, the taxpayer is willing to declare lowerselling price. This does not reflect the true value of real estatetransactions, and causes a loss of revenue for the State budget.

To promote themanagement of real estate transfer activities, the Ministry of Finance has sentan official dispatch to the People's Committees of the provinces andcentrally-run cities, police and Ministry of Justice to co-ordinate andimplement solutions to prevent losses.

The Ministryof Finance and tax authorities at all levels have guided people and businessesto properly declare the transfer price as a basis for tax calculation inaccordance with the law. The Ministry of Finance has also directed the GeneralDepartment of Taxation to request tax authorities strengthen co-ordination withlocal agencies and departments in the management of real estate transferactivities, especially strengthening criminal handling for acts of tax evasionrelated to business activities and real estate transfer.

The GeneralDepartment of Taxation has taken a number of measures to collect evidence toverify the transfer price such as verifying with the Notary Offices about thedeposit contract, the contract appendix with the adjusted price, verifyingthrough the banks about transactions related to real estate transferand loans to buy real estate.

According to theGeneral Department of Taxation, in the first three months of 2022,personal income tax revenue from real estate transfer activities reached 8.2trillion VND; an increase of 63 percent compared to the first three monthsof 2021.

In the future,the tax authority said it will provide the database on which taxpayers havedeclared tax, in case there is a price fluctuation, to the Agency of NaturalResources and Environment so that this agency can co-ordinate with relevantagencies to review and promptly advise the provincial People's Committee todecide to issue the land price list.

The Ministryof Finance and the General Department of Taxation also directed tax authoritiesnot to cause difficulties or trouble for taxpayers in the process of realestate transfer documents, at the same time, thoroughly direct the departmentsand teams involved in the handling of real estate transfer documents tostrictly follow the regulations on the order and procedures for handlingdocuments.

In the longterm, the tax sector will advise the authorities to amend legal policies toimprove the legal basis for management of real estate transfer.

The GeneralDepartment of Taxation also said that for cases of intentional violations, itis necessary to transfer the dossier to the police agency for investigation andstrict handling, ensuring transparency in real estate transfers./.