JOINT CIRCULAR No. 02/TT-LB GUIDING THE ESTABLISHMENT AND USE OF DEVELOPMENT INVESTMENT FUNDS, WELFARE FUNDS, AND MANAGEMENT COSTS IN THE ASSIGNMENT OF LAND FOR AGRICULTURAL AND FORESTRY PRODUCTION AT STATE ENTERPRISES

CIRCULAR

OF THE JOINT MINISTRIES OF AGRICULTURE

AND RURAL DEVELOPMENT - FINANCE

Guidelines for the establishment and use of development investment funds, welfare funds, and management costs in land contracting for agricultural and forestry production purposes at state-owned enterprises

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Implementing Decree 01/CP dated January 4, 1995 of the Government on land contracting for agricultural and forestry production and aquaculture purposes in state-owned enterprises. The Joint Ministries of Agriculture and Rural Development - Finance provide guidelines for the establishment and use of development investment funds, welfare funds, and management costs as follows:  

I. OBJECTS OF ESTABLISHING FUNDS AND MANAGEMENT COSTS.

1. The contracting party includes state-owned enterprises that have implemented land contracting for agricultural and forestry production purposes.

2. The contractor party includes:

Households and individuals who are workers or officials currently working for the contracting party, or those who have retired, left work due to health reasons, or terminated employment and are receiving benefits, along with family members of working age.

Households and individuals residing legally in other localities with a need to contract and produce according to the planning of the contracting party.

II. PRINCIPLES AND BASIS FOR ESTABLISHING FUNDS.

1. Principles of establishment.

a) Fairness, democracy, transparency, and acceptance by the contractor party through meetings between the contracting party and the contractor party.

b) The contractor party has the responsibility to contribute according to the agreement in the contract.

2. Basis for establishment.

a) Based on the area and profitability conditions of the contracted land.

b) Based on plans for investment in construction of facilities serving production and welfare, and accepted by the contractor party.

c) Based on the business conditions of each enterprise and the impact on management work between the contracting party and the contractor party to calculate revenue.

III. LEVEL OF RAISING AND COLLECTION METHODS:

1. Level of raising: Is the agreed level between the contracting party and the contractor party, defined as a percentage of the land use tax rate and controlled as follows:

a) Development investment fund not exceeding 10% of the agricultural land use tax rate.

b) Welfare fund not exceeding 5% of the agricultural land use tax rate.

c) Management costs not exceeding 15% of the agricultural land use tax rate.

d) In special cases where there is a need to spend more than the agreed level but not exceeding the maximum control level mentioned above, the contracting party must negotiate and reach consensus with the contractor party.

2. Collection method: The contracting party agrees with the contractor party to collect contributions once a year in cash for perennial crop land and twice a year for annual crop land.

IV. CONTENTS OF MANAGEMENT AND USE OF FUNDS AND MANAGEMENT COSTS:

1. Content of management: The revenues stipulated in this circular are to supplement the sources of funds and management expenses of the enterprise. The management of these funds shall be carried out in accordance with the regulations and guidance of the Ministry of Finance.

2. Contents of using funds and management costs.

a) Development investment fund: For investment and maintenance of irrigation works, internal roads to serve common production on contracted land.

b) Welfare fund: For building, purchasing, improving, and maintaining public welfare facilities such as schools, kindergartens.

c) Land management costs: Used to purchase books, documents, pay wages to those directly overseeing the land contracting contracts (excluding costs for industrial processing, services, and social welfare activities of the enterprise).

V. REGARDING IMPLEMENTATION:

1. State-owned agricultural enterprises that have contracted land for production purposes should base their plans for establishing and using funds and management costs on the contents of this circular.

2. Annually, enterprises must publicly settle accounts regarding the establishment and use of funds and management costs with the contractor party and report to the competent authority for approval together with the annual settlement of the unit.

3. This circular takes effect from the date of issuance, all provisions contrary to this circular are abolished. During implementation, if there are any difficulties, units should promptly report to the Joint Ministries of Agriculture and Rural Development - Finance for consideration and resolution.