Circular No. 105/2005/TT-BTC guiding the implementation of Government Decree No. 137/2005/NĐ-CP dated November 9, 2005 on environmental protection fees for mineral exploitation.

CIRCULAR

Guidelines for Implementing Decree No. 137/2005/NĐ-CP dated November 9, 2005

of the Government on Environmental Protection Fees for Mineral Extraction

Pursuant to Decree No. 137/2005/NĐ-CP dated November 9, 2005 of the Government on Environmental Protection Fees for Mineral Extraction;

Pursuant to Decree No. 57/2002/NĐ-CP dated June 3, 2002 of the Government detailing the implementation of the Ordinance on Fees and Charges;

The Ministry of Finance issues guidelines for implementing Environmental Protection Fees for Mineral Extraction as follows:

This technical regulation sets out technical requirements, testing methods, sampling procedures; management requirements; responsibilities of organizations and individuals producing, trading, and importing cigarettes.

1. The subjects liable to pay Environmental Protection Fees for Mineral Extraction are the minerals specified in Article 2 of Decree No. 137/2005/NĐ-CP dated November 9, 2005 of the Government on Environmental Protection Fees for Mineral Extraction (hereinafter referred to as Decree No. 137/2005/NĐ-CP), including: rock, travertine, gravel, clay, gypsum, sand, soil, coal, natural mineral water, and titanium ore (ilmenite).

2. The subjects required to pay Environmental Protection Fees for Mineral Extraction are organizations and individuals (domestic and foreign) extracting the types of minerals specified in Point 1 of this item.

II. SPECIFIC PROVISIONS

1. Calculation Method and Collection Rate of Fees

a) The Environmental Protection Fee for Mineral Extraction payable during the payment period shall be calculated as follows:

b) The collection rate of the Environmental Protection Fee for Mineral Extraction (as stipulated in Article 4 of Decree No. 137/2005/NĐ-CP) is determined by a fixed amount of money per unit of mineral product at the extraction site, as follows:

d) The Environmental Protection Fee for Mineral Extraction shall be collected in Vietnamese dong. In cases where the fee payer requests payment in foreign currency, it shall be collected in foreign currency based on the conversion rate from foreign currency to Vietnamese dong published by the State Bank of Vietnam at the time of fee collection.

2. Registration, Declaration, Collection, and Payment of Fees

a) Subjects required to pay Environmental Protection Fees for Mineral Extraction have the obligation to:

- Register to pay Environmental Protection Fees for Mineral Extraction with the direct tax authority managing them according to the prescribed form (Form 1 issued together with this Circular) within the latest 10 working days from the date they are permitted to operate mineral extraction. In cases of merger, consolidation, division, spin-off, dissolution, bankruptcy, ownership transfer; transfer, sale, lease, contracting state-owned enterprises or changes in mining operations, mining organizations and individuals must report to the tax authority at least 5 working days before the merger, consolidation, division, spin-off, dissolution, bankruptcy, ownership transfer; transfer, sale, lease, contracting state-owned enterprises or changes in mining operations.

- Declare Environmental Protection Fees for Mineral Extraction monthly according to the prescribed form (Form 2 issued together with this Circular) to the direct tax authority managing them within the first 10 days of the following month; in cases where no Environmental Protection Fees for Mineral Extraction arise in the month, organizations and individuals extracting minerals still need to declare and submit the declaration form to the tax authority. Organizations and individuals extracting minerals must declare fully, accurately according to the declaration form and bear responsibility for the accuracy of the declaration.

- Calculate and pay Environmental Protection Fees for Mineral Extraction into the state budget at the National Treasury Office where the minerals are extracted according to the declared figures with the tax authority, not later than the 25th day of the following month. The process of paying Environmental Protection Fees for Mineral Extraction into the National Treasury Office shall be carried out in accordance with Circular No. 80/2003/TT-BTC dated August 13, 2003 of the Ministry of Finance guiding the concentration and management of state budget revenues through the National Treasury Office.

- Within 60 days after the end of the year (which is the Gregorian calendar year starting from January 1 and ending on December 31 of the same year or a fiscal year different from the Gregorian calendar if approved by the competent authority), the fee payer must settle the payment of Environmental Protection Fees for Mineral Extraction with the tax authority. Within 10 days after the tax authority issues a notice following inspection, the fee payer must pay any outstanding fees into the state budget; any overpaid fees will be refunded or offset against the Environmental Protection Fees for Mineral Extraction payable in the next period.

- For cases where the mineral extraction contract ends; merger, consolidation, division, spin-off, dissolution, bankruptcy, ownership transfer; transfer, sale, lease, contracting state-owned enterprises, the fee payer must pay any outstanding Environmental Protection Fees for Mineral Extraction within 60 days from the date the mineral extraction contract ends or the date of the decision by the competent authority regarding merger, consolidation, division, spin-off, dissolution, bankruptcy, ownership transfer or transfer, sale, lease; if there are overpaid fees, they will be refunded by the tax authority or transferred to the new business entity according to current regulations.

- In cases where a mineral exploitation contract is terminated; mergers, consolidations, divisions, spin-offs, dissolutions, bankruptcies, ownership transfers; state-owned enterprises are transferred, sold, leased, or contracted out, the fee payer must pay the full environmental protection fee for the remaining mineral exploitation within sixty days from the date of termination of the mineral exploitation contract or the date of the competent authority's decision on mergers, consolidations, divisions, spin-offs, dissolutions, bankruptcies, ownership transfers, or transfers, sales, leases, or contracts; if there is an overpayment of fees, it shall be refunded by the tax authority or transferred to the new business entity according to current regulations.

b) For subjects paying fees who have not implemented or have not fully implemented the system of vouchers, invoices, accounting books, the tax authority shall base on the situation of mineral exploitation of each subject paying fees to issue a document determining the quantity of minerals to be exploited by each subject to determine the amount of fees payable by each subject according to the provisions of Decree No. 137/2005/NĐ-CP and the guidance provided in this Circular. The basis for determining the quantity of minerals to be exploited by each subject is the investigation materials of the tax authority or the quantity of minerals actually exploited by the exploitation entity with the same scale. In cases where, through surveys of the situation of mineral exploitation in the locality (based on the declaration of the mineral exploitation entity combined with actual investigation materials on mineral resources, capital, labor, exploitation means), the Provincial Tax Department, centrally-administered city has determined the average quantity of minerals exploited by mineral exploitation entities that have not implemented or have not fully implemented the system of vouchers, invoices, accounting books, then the environmental protection fee for mineral exploitation will be uniformly determined for these entities according to the following formula:

Determining the average quantity of minerals exploited by mineral exploitation entities must ensure transparency, democracy, and accuracy with the capacity for mineral exploitation activities.

c) In cases where the mineral exploitation entity is small and scattered, the environmental protection fee for mineral exploitation to be paid is small and far from the State Treasury, the tax authority may directly collect it and periodically deposit it into the State Treasury according to the provisions of Circular No. 80/2003/TT-BTC dated August 13, 2003 of the Ministry of Finance guiding the concentration and management of state budget revenues through the State Treasury; if the extracted minerals are concentrated at a purchasing point and the purchasing entity agrees to accept, the Provincial Tax Department, centrally-administered city may decide (in writing) for organizations or individuals purchasing minerals to pay the environmental protection fee for mineral exploitation on behalf of the fee payer. The mineral purchasing entity has the obligation to declare according to the prescribed form (Form 3 issued together with this Circular), calculate, pay and settle the payment of the environmental protection fee for mineral exploitation according to the provisions of paragraph a, point 2 of this section.

d) The environmental protection fee for mineral exploitation is deposited into the State Treasury at the locality where the mineral exploitation takes place and reflected, settled into the state budget according to the corresponding chapter, type, item, sub-item 042, sub-sub-item 06 of the current State Budget Classification.

3. Management and use of collected fees

a) The environmental protection fee for mineral exploitation is a local government revenue enjoying 100% (one hundred percent) to support the funding for implementing environmental protection work in the locality where there is mineral exploitation activity, as follows:

- Preventing and limiting adverse impacts on the environment in the locality where there is mineral exploitation activity;

- Remedying degradation and pollution of the environment caused by mineral exploitation activities;

- Maintaining cleanliness, protecting and enhancing the environmental landscape in the locality where there is mineral exploitation activity.

b) The preparation of budgets, disbursement, and settlement of the environmental protection fee for mineral exploitation revenue to fund the contents mentioned in point a of this section shall be carried out according to the provisions of laws on environmental protection and state budget laws currently in force.

III. IMPLEMENTATION

1. The tax authority has the following duties and powers:

a) To guide, inspect, and urge organizations and individuals exploiting minerals to implement registration, declaration, and payment of fees in accordance with the provisions of Decree No. 137/2005/NĐ-CP and the guidance provided in this Circular;

b) To inspect and audit the declaration, payment, and settlement of the environmental protection fee for mineral exploitation; to determine the quantity of minerals to be exploited to calculate the environmental protection fee for mineral exploitation for fee payers who have not implemented or have not fully implemented the system of vouchers, invoices, accounting books according to the guidance provided in this Circular;

c) To handle administrative violations regarding the environmental protection fee for mineral exploitation within the scope of authority stipulated by law;

d) To retain and use data and materials provided by mineral exploitation entities and other subjects according to prescribed regulations.

3. This Circular takes effect from January 1, 2006.

4. Other contents related to the collection, payment, management, use, and public disclosure of fee and charge systems not mentioned in this Circular shall be implemented according to the guidance provided in Circular No. 63/2002/TT-BTC dated July 24, 2002 of the Ministry of Finance guiding the implementation of legal provisions on fees and charges.

5. During the process of implementation, if difficulties arise, organizations and individuals are requested to report to the Ministry of Finance for research and resolution./.