JOINT CIRCULAR No. 1108/TT/LB ON THE COLLECTION AND USE OF SERVICE FEES IN THE TOURISM INDUSTRY

JOINT CIRCULAR

Provisions on the collection and use of service fees in the tourism industry

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On July 2, 1980, the Prime Minister (now the Chairman of the Council of Ministers) issued Circular No. 2815/VP allowing the Tourism sector to collect 10% service fee from foreign guests.

The Ministry of Finance issued Circulars No. 25/TC/NT and No. 28/TC/NT guiding the collection and use of the 10% service fee in the Tourism sector.

The General Department of Tourism has directed all establishments to strictly implement the contents of the above documents. Therefore, it has motivated and encouraged employees in the Tourism sector to strive to improve service quality and work efficiency.

However, during the implementation process, some units have not collected the fee from the correct target groups. The distribution and use of service fees have also been unreasonable, thus failing to truly encourage frontline staff directly serving customers and those with high productivity and good service attitudes.

To make the collection and use of the 10% service fee in the Tourism sector more reasonable, the Ministry of Finance and the General Department of Tourism have now unified the following provisions:

I. Purpose and significance of collecting and using service fees

Implementing the system of service fee collection aims to motivate all employees in the Tourism sector to strive for improvement in service efficiency and quality; actively and proactively engage in business operations to increase revenue for the State, thereby enhancing collective welfare and improving the living standards of Tourism sector employees.

II. Collection targets and non-collection targets:

a) Non-collection targets:

1) Guests of the Party and State, guests of Ministries, sectors, and organizations, etc., who are covered by the State budget.

2) Heroes, model workers, and families who have contributed to the revolution, traveling for rest at the expense of the State budget through welfare funds.

3) Tour groups funded by organizations, units, and associations through welfare funds.

4) Vietnamese staff serving the aforementioned three types of guest groups, such as organizing staff, drivers, guides, interpreters, security personnel, medical staff, etc.

5) Tourism sector employees on official trips; employees from other sectors working according to the requirements of Tourism sector units and introduced to eat and stay at tourism facilities.

b) Collection targets

All targets not specified in Article II.a

III. Scope of service fee collection

Tourism business establishments are only allowed to collect a 10% service fee on services that require the effort of the service provider, including:

- Room service

- Catering services, meal courses, and banquet meals

- Renting cars and transportation means with drivers

- Laundry, tailoring, hair cutting, selling handicrafts

- Laundry, tailoring, hair cutting, selling cosmetics.

- Selling cigarettes, pastries for consumption at tables

- Renting telephones, typing, medical examinations, teaching, vocational training, tour guiding, entertainment guidance...

For goods transferred, sold at counters, or still in their original packaging, as they do not involve service efforts, service fees shall not be collected.

IV. Distribution and use:

a) Establishing a fund:

The proceeds collected by each unit will be distributed as follows:

1- Reward Fund 30%

2- Welfare Fund 20%

3- Production Development Fund 35% (including 5% for compensation)

4- Industry Concentration Fund 5%

b) Using the funds

1 – Reward Fund: Used to reward employees who have achieved outstanding results in production labor

2- Welfare Fund is used for:

- Providing midday meals for employees, additional allowances for night shifts, and duty shifts

- Building and repairing housing for employees, constructing collective welfare facilities

- Organizing tours and study visits for unit employees to other units

- Additional travel expenses when necessary

3- Production Development Fund is used for:

- Purchasing equipment to improve working conditions

- Purchasing additional uniforms and accessories for employees such as clothing, makeup, etc., to serve customers

- Purchasing cultural tools for art teams to serve customers

When performing duties, if service staff accidentally damage customer or unit property without being due to lack of responsibility or violation of regulations, and this is confirmed by the collective, then the Production Development Fund (within the 5% limit mentioned in Point IV.a.3) can be used for compensation.

5-Industry Concentration Fund is used for:

- Supplementing the training of employees in the industry

- Supplementing scientific research activities in the industry when necessary

- Supplementing funding for overseas study tours

- Supplementing construction and repair costs for classrooms and practical training facilities at training schools in the industry

- Additional travel expenses for employees under the General Department

- Rewards and midday meals for employees under the General Department and units unable to collect service fees

- Construction of collective welfare facilities for the General Department and units unable to collect service fees

- During implementation, if any unit collects fees from incorrect targets or beyond the scope as stipulated, that unit must transfer from the Welfare Fund to the State budget.

V- Implementation Organization

- When charging customers, the 10% service fee must be recorded separately on the invoice, not combined into the unit's revenue (including foreign currency revenue).

The General Department of Tourism guides all businesses in the industry to follow the spirit of this document.

Request financial agencies to cooperate with local banks to regularly monitor and assist Tourism sector units in implementing the above regulations.

This Circular takes effect from October 1, 1986. All previous documents inconsistent with these provisions are abolished.

This Circular takes effect from October 1, 1986. All previous documents that are contrary to this provision are hereby abolished. /\.