Circular No. 135-TC/TQD guiding the implementation of Decision No. 258-CP dated December 29, 1969 of the Council of Ministers on local budget revenue from the submission of agricultural products and food.

CIRCULAR
Guidelines for Implementing Decision No. 258-CP dated December 29, 1969 of the Council of Ministers on the revenue from local budgets concerning the submission of agricultural products and foodstuffs
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This Circular replaces Circular No. 18-TC/TQD dated January 14, 1970.

To encourage localities to boost production and procurement, increase the supply of agricultural products and foodstuffs for the State, raw materials for industry, and key export goods; to distribute more reasonably between the central budget and local budgets the State's revenue from agricultural products and foodstuffs, thereby providing local budgets with stable revenue from local economies, the Council of Ministers issued Decision No. 258-CP dated December 29, 1969, setting forth the revenue for local budgets concerning the submission of agricultural products and foodstuffs.

Pursuant to Article 11 of Decision No. 258-CP and Joint Circular of the Ministry of Finance, the Ministry of Trade, and the State Bank No. 93-TT/LB dated April 16, 1970, the Ministry of Finance hereby provides detailed regulations and guidelines for implementation as follows:

1. Pursuant to Article 1 of Decision No. 258-CP, the revenue for local budgets concerning the submission of agricultural products and foodstuffs (hereinafter referred to as the revenue for local budgets) shall only apply to agricultural products and foodstuffs of economic entities managed by localities (products of the people, agricultural cooperatives, local state-owned enterprises such as local farms, etc.) each time they are submitted to economic entities under the management of central ministries or other localities. In cases where local state-owned economic entities consume the aforementioned agricultural products and foodstuffs produced by themselves, they are not required to pay this revenue. Specifically:

a) Central-managed state-owned economic organizations: commerce enterprises of the domestic trade, foreign trade, health (medicinal herbs) sectors, industrial enterprises, etc., purchasing agricultural products and foodstuffs listed in Article 1 of Decision No. 258-CP must bear the revenue for local budgets;

b) Local-managed state-owned economic organizations: commerce enterprises of the domestic trade, foreign trade, health (medicinal herbs) sectors, industrial enterprises, etc., purchasing agricultural products and foodstuffs listed in Article 1 of Decision No. 258-CP from other localities must also bear the revenue for local budgets;

2. The collection measures are stipulated as follows:

a) Secondary-level commerce enterprises, local companies engaged in export goods trading, etc., purchasing agricultural products and foodstuffs and then submitting them to units or central sectors or other localities must pay the revenue for local budgets after selling the goods and receiving payment;

b) Central-managed state-owned economic organizations, or those from other localities directly purchasing agricultural products and foodstuffs from collective economic entities and individuals (agricultural cooperatives, individual producers), without going through secondary-level commerce enterprises as mentioned above, purchase at the State-guided procurement price while simultaneously paying the revenue for local budgets immediately upon settlement of the purchase price;

c) Except for the case mentioned in point a above, local state-owned economic organizations such as local state-owned farms directly submitting agricultural products and foodstuffs to central units or other localities may sell at prices including the revenue for local budgets and must pay that revenue into the local budget after selling the goods and receiving payment;

3. The revenue for local budgets concerning the submission of agricultural products and foodstuffs is calculated as a percentage (%) of the State-guided procurement price (or the price set by agencies authorized by the State). This revenue must be paid to the budget of the locality where the production and submission take place.

4. Each locality enjoys the revenue mentioned above based on the quantity of products submitted according to the national plan (or the agency authorized by the State) set for that locality: for the domestic trade sector, it refers to the procurement plan index of the Ministry of Domestic Trade regarding agricultural products and foodstuffs recorded in the "export" column, which secondary-level commerce enterprises transfer to primary-level commerce enterprises or secondary-level commerce enterprises in other provinces, etc.;

For foodstuffs supplied (at retail prices) to central-managed agencies, schools, hospitals, etc., stationed permanently in the locality, this revenue shall not be applied.

5. Implementation of the revenue collection system for local budgets concerning the submission of agricultural products and foodstuffs:

a) Secondary-level commerce enterprises, local companies engaged in export goods trading should base their pricing on their own cost standards when submitting agricultural products and foodstuffs to central units or other localities:

- The cost standard of the purchasing unit is the State-guided procurement price plus (+) the standard procurement fee plus (+) the standard profit margin;

- The selling price (price at which goods are handed over) of the purchasing unit is the cost standard (mentioned above) plus (+) the revenue from the submission of agricultural products and foodstuffs.

b) For industrial enterprises, due to changes in the price of raw materials used in production leading to increases or decreases in production costs, the level of accumulation submitted by industrial enterprises to the State budget will also change. Industrial enterprises must recalculate new production costs to propose new levels of accumulation;

c) For foreign trade enterprises, there are also changes in the cost of imported goods for export; these increases or decreases are resolved through the foreign trade exchange difference mechanism;

d) For domestic trade enterprises, there are also changes in purchase and sale prices:

- A Level I trading enterprise dealing with agricultural products and food through a Level II purchasing trading enterprise must settle according to the new price, that is, the delivery price as stipulated at point a above. When selling, a Level I trading enterprise shall sell at the wholesale price of a Level I trading enterprise (retail price minus (-) trade discount). The difference (increase or decrease) between the wholesale price of a Level I trading enterprise and the cost price (new purchase price plus (+) Level I trade discount) shall be resolved from the central budget: a Level I trading enterprise shall pay to the central budget or be compensated by the central budget. In cases where a Level I trading enterprise deals with agricultural products and food and sells them to industrial enterprises for production materials, the Level I trading enterprise may sell at the cost price plus (+) the Level I trade surplus. (Note: In this case, the raw material price that industrial enterprises have to pay will usually be higher than when industrial enterprises buy directly. Therefore, the general direction is that industrial enterprises should seek to purchase raw materials directly, not through trading.)

- A Level II trading enterprise dealing with agricultural products and food through a Level II purchasing trading enterprise in another province must settle according to the delivery price as stipulated at point a above. The difference (increase or decrease) between the local retail price and the cost price (new purchase price plus (+) Level II trade discount) shall be resolved from the provincial budget of the consuming province.

If a Level II trading enterprise purchases agricultural products and food through a Level II purchasing trading enterprise in the same province for immediate consumption in its locality, it must settle according to the local retail price minus (-) Level II trade discount. If there is a difference (increase or decrease) between the local retail price minus (-) Level II trade discount and the standard cost price of the Level II purchasing trading enterprise, then the provincial budget shall collect or compensate the Level II purchasing trading enterprise.

d) For local state-owned economic organizations (such as local state-owned farms) delivering agricultural products and food to units in central ministries and other provinces, the delivery price of such organizations shall be calculated as follows: the State's directed selling price plus (+) the amount received from delivering agricultural products and food.

6. For agricultural products and food not listed in Decision No. 258-CP, if a Level II purchasing trading enterprise delivers them to central state-owned economic organizations or other provinces, the current delivery price shall remain unchanged, while:

- The standard cost price shall be calculated as stipulated at point a of Article 5 above;

- And the difference (increase or decrease) between the delivery price and the cost price shall be resolved from the provincial budget.

7. Agricultural products and food of central state-owned economic organizations stationed in localities (central state-owned farms, central forestry, central fishing fleets...) delivered to anyone shall not apply the revenue for the local budget regarding the delivery of agricultural products and food; the purchase and sale, settlement, and tax payment shall still follow the existing regulations. However, for convenience in accounting and settlement by enterprises, for agricultural products subject to goods tax (such as tobacco), they can be sold at the price applied to similar goods that localities deliver to the center, that is, equal (=) to the State's directed selling price plus (+) the amount received from delivering agricultural products and food. This amount shall be paid into the central budget, Category III, Item 90; the category shall be recorded according to specific items as stipulated.

8. Regarding the procedures for collection and payment

a) Units submitting revenue to the local budget regarding the delivery of agricultural products and food must proactively fill out a declaration form (attached model) [1], fully recording: quantity of agricultural products and food, by item; delivery price (for local purchasing organizations when selling goods) or purchase price plus (+) the amount received from delivering agricultural products and food (for state-owned economic organizations directly purchasing agricultural products and food without going through local purchasing trading organizations); amount to be paid into the State budget. The declaration form also serves as a payment authorization form for the budget, which must be made in five copies (one for the local collection agency, four sent to the local State Bank); in addition, the unit submitting must keep one copy for record.

Local purchasing organizations, when selling goods, must daily declare the quantity of agricultural products and food sold, recording each sales invoice, and submit the declaration immediately on the day of delivery if payment is made via "collection on delivery"; if payment is made by check (standard or advance) or cash, then the declaration must be submitted no later than the day of delivery.

The date for submitting revenue regarding the delivery of agricultural products and food is the date, according to the State Bank's regulations, when the proceeds from sales must enter the seller's account in the bank if payment for goods is made via "collection on delivery".

If payment for goods is made by check (standard or advance) or cash, then this revenue must be submitted no later than the next day after receiving the check or cash.

Other state-owned economic organizations directly purchasing agricultural products and food without going through local purchasing organizations must declare each purchase trip, submit the declaration and pay the revenue regarding the delivery of agricultural products and food no later than the next day after payment for the purchase.

b) The State Bank, upon receiving the declaration as stipulated at point a, must monitor and urge the timely payment of goods based on the State Bank's deadline, ensuring that enterprises submit the revenue fully and on time, and must:

- Deduct from the accounts of purchasing organizations and transfer the amount due to the local budget or central budget (as stipulated in this circular) immediately after the proceeds from sales enter the account.

- Deduct from the accounts of other state-owned economic organizations (as stipulated in this Circular) and transfer the amount due for payment to the local budget or central budget immediately after the enterprise pays for the goods purchased.

c) Local collection agencies must verify the declaration forms and urge the timely submission of revenues related to the delivery of agricultural products and food to the budget.

9. Those entities required to pay such revenue, if they fail to make the payment by the due date, shall be subject to a daily penalty equal to one ten-thousandth (0.01%) of the overdue amount.

The State Bank, postal service, if there are any omissions (such as delayed transfers, delayed circulation of documents, etc.), causing the enterprise to incur penalties, shall compensate the enterprise.

10. Agricultural products and food items subject to local budget revenue from the delivery of agricultural products and food, if traded by state-owned organizations, shall not be subject to goods tax, slaughter tax, and business tax (implementing Article 8 of Decision No. 258-CP).

- Goods tax still applies to product exchanges (above self-consumption levels) in scattered and dispersed production areas where state trade has not yet unified purchases.

- Slaughter tax continues to apply to agencies, enterprises, and individuals slaughtering animals for consumption (for eating or resale).

11. These provisions in this Circular shall take effect from January 1, 1970.

The Ministry of Finance requests that the relevant ministries, sectors at the central level, provincial administrative committees, and centrally-administered city committees guide all units to fully comply with the regulations of the Council of Ministers (Decision No. 258-CP dated December 29, 1969) and the provisions in this Circular; during the implementation process, please inform the Ministry of Finance of issues requiring further research and supplementation.