HCM City Real Estate Association (HoREA)
proposed to extend and recover debts, and lengthen the deadline of corporate
income tax (CIT) payment till December 31, 2013.
Today
[April 11], the association will work with the National Finance Supervision
Committee to help realty companies deal with problems in terms of capital, tax,
interest rates, land using rental, market liquidity.
Massive bankruptcy
Mr Le
Hoang Chau, Chairman of HoREA told the reporters that real estate companies are
facing a lot of difficulties, eve many of them are ailing and dying.
The
property market is almost unmoved. The firms tried to save themselves with a
number of solutions such as investment restructuring, delay, project progress
extension. Especially, enterprises actively lowered apartment prices, and
accepted break-even or small losses by financing customers in field of loan
rates and various promotion programs, he added.
Despite
big efforts, resources of real estate companies have gone down so most of firms
were meeting multiple hardships and threats of bankruptcy. Many companies had
to stop operation or become bankrupt. These hardships are shown in indicators
of inventory, money flow, high loan interests. A survey on listed property
firms on both securities exchanges indicated that the inventory volume written
in their financial report was too huge. Several developers could not boost
sales and pay any dividend for shareholders, so they had to record big losses.
A
series of property brokering offices after 2012 Lunar New Year also had to be
closed, liquidated or change service business to drinks and restaurant.
“Property firms are ailing, some other sectors like cement, steel and cast
iron, furniture, employees….are heavily affected as well”, he emphasized.
Need help
The
meeting between the National Finance Supervision Committee and HoREA will
discuss on credit source, reasons of the gloomy market, property management
policies, credit tightening policies, oversupply, and high product prices
compared with buyers’ affordability.
On this
occasion, HoREA will continue proposing urgent actions of the government and
the State Bank of Vietnam (SBV) in lowering lending rates for enterprises and
offering a specific timetable to bring down loan rate to 11-12% per annum.
Currently, property companies are hard to access credit source and suffer the
loan rate of around 20% pa. If the situation is prolonged continuously,
enterprises will cannot stand, according to Mr Chau.
In
addition, the association plans to propose the government, Ministry of Finance
and General Department of Taxation to cut Corporate Income Tax (CIT) from 25%
to 18-20% and extend CIT payment to the next year.
Furthermore,
HoREA will recommend amendments for Decree 69, Decree 120 on collecting land
using rental to help property projects reduce input costs and product prices.
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