Scenario: the province hosting the factory issues a new land price list with sharp increases at many industrial positions. The finance director asks: how much does the factory’s land rent rise next year, and does the new price apply immediately? The correct answer separates three layers: how the price list changes, where the project’s unit price is locked in its 5-year cycle, and where the increase is capped in the new cycle. This article analyses the new price lists’ impact under the Land Law 31/2024/QH15 on annual-paying foreign investors.
Layer one: price lists move to an annual issuance rhythm
Article 159 of the Land Law 31/2024/QH15 changes the price-list rhythm: instead of the former fixed five-year lists, provincial People’s Committees issue land price lists annually, applying from 1 January 2026. The direct consequence is that the land price used as the base for rent calculation (the third component of the formula in Decree 103/2024/ND-CP) will track market levels more closely, and industrial land market increases will transmit into state prices faster. But distinguish two price types clearly: the price list is an input to the State land-rent formula — it is not land rent itself; and it does not touch commercial sub-lease prices inside industrial parks at all, those being agreed prices with the developer. An in-park sub-lessee is therefore not directly affected by the new list, only indirectly through the developer’s land cost in later price negotiations.
Layers two and three: the stability cycle and the CPI cap protect sitting tenants
Clause 2, Article 153 of the Land Law 31/2024/QH15 builds two cushions between the new price list and an operating project’s land-rent bill. The first cushion is the stability cycle: the project’s unit price is determined at the land lease decision and held for 5 years — no price-list movement inside the cycle changes the amount payable. The second cushion is the increase cap on cycle transition: the new cycle’s unit price is priced off the price list of the new cycle’s first year, but its increase over the previous cycle’s price is limited to the Government-set rate for each period and may not exceed the cumulative consumer price index (CPI) of the five years immediately preceding that cycle. These two cushions turn the new list’s impact into a process with a minimum five-year lag and a capped increase band, instead of an instant shock. The finance function’s governance task is to pinpoint exactly which year of the cycle its project is in, and to model the next cycle’s opening unit-price scenario (rising up to the cumulative CPI cap) into long-term cash-flow forecasts.
What enterprises should do before and after a new list issues
Before issuance: join the local draft price-list consultation channel — the list-building sequence under Article 159 and Decree 103/2024/ND-CP includes a consultation step, and data-backed input (actual transaction prices, project cost impacts) from the FDI community through industry associations is substantively weighed by the drafting authority. After issuance: reconcile the first land-rent notice against three checks — is the project inside a stability cycle, is the applied unit price the correct list price for the plot’s position and use purpose, and if it is a new cycle, does the increase exceed the statutory cap. An error found at any layer is complained against at that layer (detail in the Q&A). One mistake to avoid is reacting to province-wide average increase rumours: each project is affected by its own cycle and plot, and two neighbouring factories can receive entirely different outcomes if one has just entered a new cycle while the other is in year two of its stability cycle.
Frequently Asked Questions
How much will the new land price tables raise land rent?
There is no single percentage for all enterprises, because the increase depends on three variables of each plot: how much the province’s new land price list changes at that position and use purpose; which year of its 5-year unit-price stability cycle the project is in; and whether the province’s rent percentage rate changes. What is certain under the mechanism: land price lists under the Land Law 31/2024/QH15 are issued annually from 1 January 2026, so the land price base for rent will update much faster than in the five-year list era. But the impact on a specific project’s rent is blocked by two statutory cushions: within a stability cycle the unit price does not change however much the list rises; when reset in a new cycle, the increase is limited by the Government-set rate and may not exceed the cumulative CPI of the preceding 5 years (clause 2, Article 153). An enterprise wanting its own figure must compute with these three variables on its own plot, not with the province’s average increase coefficient.
Are sitting tenants charged the new prices immediately, or only after their stability cycle ends?
They wait until the stability cycle ends — the crux of clause 2, Article 153 of the Land Law 31/2024/QH15. Annual land rent is charged at the unit price determined when the State decided to lease the land, stable within a 5-year cycle; inside that cycle, a higher new price list from the provincial People’s Committee does not recalculate a sitting project’s unit price. The new list reaches a project at only three moments: when it enters the next stability cycle (the new unit price priced off the new cycle’s first-year list, with a capped increase); when the enterprise leases new or additional land; and when a change of use purpose or detailed planning triggers rent recalculation as prescribed. A land-rent notice that rises mid-cycle outside the recalculation cases is legally questionable and should be complained against and reconciled immediately.
Are there transition or shock-absorption mechanisms for sitting tenants?
Two statutory shock absorbers and one procedural channel. First, the 5-year stability cycle in clause 2, Article 153 is itself an automatic transition mechanism: the enterprise has at least several years to adapt before a new unit price applies. Second, the CPI increase cap: when the unit price is reset for the next cycle, the increase over the previous cycle is limited to the Government-set rate for each period and in all cases may not exceed the cumulative consumer price index of the preceding 5 years — a market price list rising 80% does not mean rent unit prices rise 80%. Third, at the local level, when issuing the annual price list the provincial People’s Committee must consult and assess impact under the list-building sequence in Article 159 of the Land Law and Decree 103/2024/ND-CP — enterprises and industry associations have an official channel to comment on the draft list before issuance, and that is the most effective intervention moment.
Where should a company petition or complain if the new prices are too high?
Through two different channels depending on the petition’s object. For the price list in general (prices at a position or use purpose deemed inappropriate): comment during the list-building process at the land-management department and the provincial People’s Committee — the issuing authority; after issuance, petition for review through the same-level People’s Council and policy feedback channels, because the list is a local normative document, not an individual decision for ordinary administrative complaint. For the enterprise’s own specific land-rent notice (wrong list applied, wrong position, wrong cycle): complain to the tax authority that issued the notice and the authority that determined the unit price, with documents proving the erroneous component — this is an individual administrative decision, complainable under the Law on Complaints 02/2011/QH13 and actionable in administrative court if not accepted.
