DECREE NO. 05/2009/ND-CP DUPLICATE DOCUMENT Details on the Implementation of the Mineral Resources Tax Ordinance and the Ordinance Amending and Supplementing Article 6 of the Mineral Resources Tax Ordinance

DECREE

Details implementing the Natural Resources Tax Ordinance and

The Ordinance amending and supplementing Article 6 of the Natural Resources Tax Ordinance

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THE GOVERNMENT

Pursuant to the Law on Organization of the Government dated December 25, 2001;

Based on the Natural Resources Tax Ordinance dated April 10, 1998;

Based on the Ordinance amending and supplementing Article 6 of the Natural Resources Tax Ordinance dated November 22, 2008;

Considering the proposal of the Minister of Finance,

DECREE:

PART I

TAXPAYERS AND SUBJECTS OF THE NATURAL RESOURCES TAX

Clause 4 of Article 6Organizations and individuals conducting natural resource exploitation in all forms are taxpayers for the natural resources tax as stipulated in Article 1 of the Natural Resources Tax Ordinance.

Article 2.Natural resources within the mainland, islands, inland waters, territorial seas, exclusive economic zones, and continental shelf under the sovereignty and jurisdiction of the Socialist Republic of Vietnam are subjects of the natural resources tax, including:

1. Metallic minerals.

2. Non-metallic minerals, including common construction materials and soil extracted for land leveling, embankment works, raw materials, and other purposes; mineral water, natural hot water as defined in Article 2 of the Law on Minerals.

3. Crude oil as defined in Clause 2, Article 3 of the Petroleum Law.

4. Natural gas as defined in Clause 3, Article 3 of the Petroleum Law.

5. Coal gas as defined in Clause 3, Article 1 of the Law Amending and Supplementing Certain Provisions of the Petroleum Law.

6. Natural forest products include: various types of plants, animals, and other products from natural forests.

7. Natural aquatic products include: various types of marine, river, stream, and lake animals and plants.

8. Natural water includes: surface water, groundwater, except mineral water and natural hot water as defined in Clause 2 of this Article.

9. Other types of natural resources.

Article 3. In cases where enterprises exploiting natural resources are established based on joint ventures or business cooperation contracts, the natural resources tax payable by the joint venture enterprise and the foreign party as determined in the business cooperation contract shall be included in the share allocated to the Vietnamese party. When allocating exploitation products, the Vietnamese party is responsible for paying the natural resources tax to the state budget in accordance with the State Budget Law and this Decree.

Chapter II

BASIS FOR CALCULATING TAX, TAX SCHEDULE, AND METHODS OF PAYING THE NATURAL RESOURCES TAX

Article 4. The basis for calculating the natural resources tax is the actual commercial production volume of natural resources exploited, the taxable price, and the tax rate. For crude oil, natural gas, and coal gas (hereinafter referred to collectively as oil and gas), the basis for calculating the natural resources tax is determined based on the progressive scale of the total actual production volume of oil and gas during each tax payment period calculated according to the average daily production volume of oil and gas under the oil and gas contract, the natural resources tax rate, and the number of days of exploitation during the tax calculation period.

Article 5.The actual commercial production volume of natural resources is the quantity, weight, or volume of natural resources actually exploited during the tax payment period, regardless of the purpose of exploitation.

Article 6.

1. The taxable price of the natural resources tax is the unit selling price of the natural resource product at the place of exploitation.

a) For types of natural resources exploited in the month with the same grade and quality, part of the production volume of natural resources is sold at the place of exploitation at market prices, while another part is sold elsewhere or used for production, processing, screening, sorting, or selection, then the taxable price of the entire production volume of natural resources exploited is the unit selling price of that natural resource product at the place of exploitation excluding value-added tax.

b) If there is an increase in the production volume of natural resources in the month but no revenue from selling natural resources is generated, the unit taxable price of natural resources is determined based on the unit taxable price of the natural resource product in the immediately preceding month.

2. In cases where the unit selling price of the natural resource product cannot be determined as specified in Clause 1 of this Article, the unit taxable price of natural resources is determined based on one of the following bases:

a) The average market selling price of the unit of the same type of natural resource exploited with equivalent value.

b) The unit selling price of the pure product and the content of that substance in the exploited natural resource or the price of the pure product and the content of each substance in the exploited natural resource.

c) A percentage of the selling price of the product produced or processed from the exploited natural resource.

3. The taxable price of the natural resources tax for specific cases is as follows:

a) For natural water used for hydroelectric power production, the taxable price of the natural resources tax is the average selling price of commercial electricity; the taxable price for mineral water and natural water used for other purposes is implemented according to point c, Clause 2 of this Article.

b) For timber, the taxable price is the selling price at the delivery site.

c) For oil and gas, the taxable price of the natural resources tax is determined as follows:

For crude oil, the taxable price of the natural resources tax is the weighted average selling price of crude oil sold at the delivery point according to the fair trade contract.

For natural gas and coal gas, the taxable price of the natural resources tax is the selling price according to the fair trade contract at the delivery point.

In cases where crude oil, natural gas, and coal gas are sold without a fair trade contract, the taxable price is determined by the Ministry of Finance.

4. The Ministry of Finance shall provide guidance on determining the taxable price of the natural resources tax as stipulated in this Article.

5. Provincial People's Committees and municipal people's committees directly under the central government shall specify the taxable price for natural resources whose unit selling price cannot be determined (excluding oil, gas, and natural water used for hydroelectric power production) in accordance with the guidelines of the Ministry of Finance.

Article 7.

1. The natural resources tax schedule is issued in Appendix I and Appendix II attached to this Decree.

2. Based on the market price of each type of natural resource and management requirements for each type of natural resource during each period, the Ministry of Finance shall take the lead in coordinating with relevant ministries and sectors to submit to the Prime Minister for decision on adjusting the tax rates for each type of natural resource in the natural resources tax schedule issued with this Decree in accordance with the tax rate schedule prescribed in Article 1 of the Ordinance Amending and Supplementing Article 6 of the Natural Resources Tax Ordinance dated November 22, 2008.

Article 8.Organizations and individuals exploiting natural resources shall register, declare, and pay the natural resources tax in accordance with the law on tax administration. Specifically for oil and gas, it is carried out as follows:

1. Mineral resource tax on oil and gas extraction shall be paid in crude oil, natural gas, coal gas, in cash, or partly in cash and partly in crude oil, natural gas, or coal gas, in accordance with the regulations of the Ministry of Finance. The tax authority shall notify the taxpayer in writing six months in advance whether the mineral resource tax will be paid in cash or in oil and gas.

2. The place for paying the mineral resource tax collected in crude oil, natural gas, or coal gas is the delivery point. In case the tax authority requires payment at another location, the taxpayer may deduct transportation costs and other direct costs incurred due to the change in the payment location from the mineral resource tax payable.

Chapter III

EXEMPTIONS AND REDUCTIONS OF MINERAL RESOURCE TAX

Article 9. The mineral resource tax shall be exempted or reduced in the following cases:

1. Organizations and individuals extracting mineral resources that suffer from natural disasters, enemy attacks, or unexpected accidents causing losses to declared and taxed mineral resources shall be considered for exemption of the mineral resource tax payable for the lost mineral resources. If the tax has already been paid, it shall be refunded or offset against the mineral resource tax payable in the subsequent period.

2. Organizations and individuals operating marine fishing in distant waters using large-capacity vessels shall be exempted from the mineral resource tax for five years from the date of issuance of the Fishing License and have their mineral resource tax reduced by 50% for the next five years. After the above tax exemption and reduction period, if organizations and individuals engaged in marine fishing in distant waters still incur losses, they may continue to be considered for a reduction in the mineral resource tax corresponding to the annual loss for up to five consecutive years.

3. The mineral resource tax shall be exempted for natural forest products harvested by individuals with permission for daily living needs such as wood, branches, firewood, bamboo, rattan, mai, giang, tranh, vầu, lồ ô.

4. The mineral resource tax shall be exempted for natural water used in hydroelectric power production not connected to the national power grid.

5. Organizations and individuals extracting land for the following purposes shall be exempted from the mineral resource tax:

a) Filling and constructing facilities serving security and defense;

b) Filling and constructing dike, irrigation, and agricultural, forestry, and fishery facilities;

c) Filling and constructing humanitarian, charitable facilities, or preferential facilities for those who have contributed to the revolution; self-extracted and used-in-place land within the allocated or leased area;

d) Filling and constructing infrastructure facilities in mountainous areas (in districts classified as mountainous districts) to serve economic and social development in the region;

e) Filling and constructing key national projects as decided by the Government for specific cases.

The exemption of the mineral resource tax under Clause 5 of this Article shall only apply to units extracting land without a business purpose.

Article 10.The exemption of the mineral resource tax for organizations and individuals engaged in marine fishing and unprocessed salt production until 2010 shall be implemented according to the provisions of Clause 2, Section II of Resolution No. 47/2005/QH11 dated November 1, 2005 of the National Assembly.

Chapter IV

IMPLEMENTING PROVISIONS

Article 11.This Decree takes effect from the date of signature.

1. Abolish the following Decrees: No. 68/1998/NĐ-CP dated September 3, 1998, No. 147/2006/NĐ-CP dated December 1, 2006 of the Government detailing the implementation of the Mineral Resource Tax Ordinance, and Articles 44, 45, 46, and 47 of Decree No. 48/2000/NĐ-CP dated September 12, 2000 of the Government detailing the implementation of the Petroleum Law.

2. For investment projects or oil and gas contracts signed before the effective date of this Decree, if the Investment License or Oil and Gas Contract specifies the payment of the mineral resource tax, it shall be implemented according to the provisions of the Investment License or Oil and Gas Contract. For oil and gas contracts not yet signed before the effective date of this Decree but approved by the Prime Minister regarding the mineral resource tax rate, it shall be implemented according to the Prime Minister's approval decision.

Article 12.The Ministry of Finance shall provide guidance on the implementation of this Decree.

Ministers, Heads of ministerial-level agencies, Heads of agencies under the Government, Chairmen of provincial People's Committees directly under the Central Government, and related organizations and individuals are responsible for implementing this Decree./.