The National Assembly of Vietnam on Thursday decided not to introduce a new tax on home ownership, saying local residents are not ready for the tax yet.
The majority of the legislative body, 79 percent, voted against the tax when they passed a new law on non-agricultural land use.
According to the National Assembly Standing Committee, many people still have financial difficulties as the economy has not yet stabilized and a new housing tax would become a heavy burden.
Legislators said the proposed tax aims to curb housing speculation, but it is in fact land speculation that needs to be controlled. As a result, they decided to continue imposing taxes on land instead.
Under the law on non-agricultural land use, land for housing purposes would be taxed at rates of up to 0.15 percent depending on whether the area exceeds official quotas. Land used outside of one's designated ownership will subject to a 0.2 percent tax rate.
Meanwhile, land used for religious purposes and by businesses that employ war invalids as at least half of their workforce will not be taxed.
The law, renamed from the original House and Land Tax Bill, will come into effect on January 1, 2012.
The National Assembly on Thursday also passed four other new laws, including the law on the handicapped, a law on efficient use of energy, and an adoption law and postal service law.