The Government has amended regulations to reduce value added tax (VAT) by 50 percent on housing built by developers for students, workers, and poor people.

Apartment blocks built for low income people in Tan Binh District of Ho Chi Minh City.

The Government approved a draft resolution on housing for students, the urban poor, and workers in industrial parks and export processing zones at its regular monthly meeting on March 31.

They will receive the following support: land rent and land-use fee waiver; no corporate income tax for the first four years; an increase in floor area ratio to reduce construction costs; the right to choose contractors; houses built for workers will be treated as part of businesses’ fixed assets and allowed to depreciate; soft loans and interest subsidy.

The government’s target is to provide accommodation for 50 percent of workers at industrial parks and export processing zones by 2015.

In the beginning of the year the Ministry of Construction drew up a proposal to encourage developers to build low-income housing.

The ministry said of the 2 million officials in the country only two-thirds own a house.

VietNamNet/SGGP