Circular No. 21/2008/TT-BTC guides the method and rate of fee collection and rental price for using the national railway infrastructure invested by the State.

CIRCULAR

Guidelines for the method and rate of fees and rental prices for using the national railway infrastructure invested by the State

Pursuant to Decree No. 170/2003/NĐ-CP dated December 25, 2003 of the Government detailing the implementation of certain provisions of the Price Ordinance;

Pursuant to Decree No. 60/2003/NĐ-CP dated June 10, 2003 of the Government detailing and guiding the implementation of the Law on State Budget;

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; and Decree No. 24/2006/NĐ-CP dated March 6, 2006 of the Government amending and supplementing some articles of Decree No. 57/2002/NĐ-CP dated June 3, 2002 of the Government detailing the implementation of the Ordinance on Fees and Charges;

Pursuant to Decree No. 85/2007/NĐ-CP dated May 25, 2007 of the Government detailing the implementation of certain provisions of the Law on Tax Administration;

Pursuant to Decree No. 77/2003/NĐ-CP dated July 1, 2003 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Pursuant to Decision No. 84/2007/QĐ-TTg dated June 11, 2007 of the Prime Minister regarding the method and level of collecting fees and rental prices for the use of national railways invested by the State;

The Ministry of Finance guides the method and rate of fees and rental prices for using the national railway infrastructure invested by the State as follows:

I. SCOPE AND APPLICABLE ENTITIES

1. This Circular provides guidelines on the method and rate of fees and rental prices for using the national railway infrastructure invested by the State.

2. The applicable entities of this Circular are organizations and individuals participating in managing, using, and operating the national railway infrastructure invested by the State.

3. The system of national railway infrastructure invested by the State includes:

- Bridge, culvert, and tunnel systems of various types.

- Railway track systems: mainline tracks, station tracks, tracks leading to cargo yards, tracks for loading and unloading goods, sections of roads leading to stations and sections of roads leading to cargo yards within the railway sector's management, marking, retaining walls, drainage systems, retaining walls, marker piles, operational facilities for locomotives and carriages, and other auxiliary facilities necessary for organizing train operations.

- Information and signaling equipment systems: entry and exit signals at stations, signal cable systems, communication cable systems, train control devices, centralized control and command systems, transmission systems, power supply systems, switchboards, communication and signaling-electricity duty houses, power supply systems.

- Architectural systems: passenger waiting rooms, ticket sales offices, baggage and cargo storage houses, station squares, platforms, station area fences, wing walls, cargo yards, guard posts for level crossings, bridge guard posts, tunnel guard posts, level crossing barrier equipment.

4. In cases where international treaties to which the Socialist Republic of Vietnam is a member have different provisions regarding fees and rental prices for the national railway infrastructure invested by the State, such provisions shall be applied according to the treaty's provisions.

II. FEES FOR USING THE NATIONAL RAILWAY INFRASTRUCTURE INVESTED BY THE STATE

1. Fees for using the national railway infrastructure invested by the State are revenue belonging to the state budget. Monthly, within the first 20 days of the following month, railway transport enterprises are responsible for declaring the amount of fees for using the railway infrastructure that must be paid, which is 8% of the actual revenue from railway transport operations in the previous month, to the tax authority at their headquarters according to Form 01/PHLP issued together with Circular No. 60/2007/TT-BTC dated June 14, 2007 of the Ministry of Finance guiding the implementation of certain provisions of the Law on Tax Administration and guiding the implementation of Decree No. 85/2007/NĐ-CP dated May 25, 2007 of the Government detailing the implementation of certain provisions of the Law on Tax Administration.

2. Not later than the 25th day of the following month, railway transport enterprises must pay the fee for using the railway infrastructure into the Central State Budget at the Treasury Office on their territory according to the corresponding chapters, categories, clauses, items, and sub-items of the current State Budget Classification.

3. Railway transport enterprises may include the amount of fees for using the railway infrastructure that must be paid as a reasonable business expense when determining corporate income tax payable.

4. Not later than the 90th day from the end of the calendar year, railway transport enterprises are responsible for declaring and settling accounts with the tax authority at their headquarters the fee for using the railway infrastructure according to Form 02/PHLH issued together with Circular No. 60/2007/TT-BTC dated June 14, 2007 of the Ministry of Finance.

III. RENTAL PRICES FOR USING THE NATIONAL RAILWAY INFRASTRUCTURE INVESTED BY THE STATE

1. List of services for which the State prescribes price ranges.

The list of services prescribed in the price range for renting national railway infrastructure projects invested by the State (excluding train operation) includes:

- Renting warehouse and yard services;

- Renting retail space services;

- Renting advertising space services;

- Other services utilizing railway infrastructure.

2. Procedure for establishing, submitting, and reviewing the pricing framework proposal.

2.1. The Vietnam Railway Corporation establishes the pricing framework proposal, submits it to the Ministry of Transport for examination and review, and requests the Ministry of Finance in writing to prescribe the pricing framework for leasing services using the national railway infrastructure invested by the State.

2.2. The dossier for approving the pricing framework includes:

- A letter from the Ministry of Transport requesting the Ministry of Finance to prescribe the pricing framework for leasing services using the national railway infrastructure invested by the State.

- The Ministry of Transport's review document on the pricing framework for leasing the national railway infrastructure invested by the State.

- The pricing framework proposal established by the Vietnam Railway Corporation. This includes explanations on the following contents:

+ The necessity to prescribe or adjust the pricing framework; production and business conditions of leasing services using the national railway infrastructure listed in the State-prescribed pricing framework.

+ Revenue from leasing railway infrastructure activities; direct costs related to leased railway infrastructure (wages, labor costs, other direct costs...); market price levels for similar services.

+ Measures to organize and implement new pricing levels.

+ Other related documents.

2.3. BASED ON THE FRAMEWORK OF RENTAL PRICES FOR THE USE OF NATIONAL RAILWAY INFRASTRUCTURE STRUCTURES AS PROVIDED BY THE MINISTRY OF FINANCE AND THE ACTUAL SITUATION IN EACH LOCALITY, ENTERPRISES OPERATING RAILWAY INFRASTRUCTURE SHALL ISSUE SPECIFIC PRICES APPLICABLE TO EACH TYPE OF SERVICE AND MUST PUBLICIZE THEM OPENLY SO THAT ORGANIZATIONS AND INDIVIDUALS CAN IMPLEMENT.

3. METHODS OF CHARGING RENT FOR THE USE OF NATIONAL RAILWAY INFRASTRUCTURE.

3.1. MONTHLY, WITHIN THE FIRST 20 DAYS OF THE FOLLOWING MONTH, ENTERPRISES OPERATING RAILWAY INFRASTRUCTURE SHALL BE RESPONSIBLE FOR DECLARING 20% OF THE AMOUNT COLLECTED FROM RENT FOR THE USE OF NATIONAL RAILWAY INFRASTRUCTURE TO BE SUBMITTED TO THE TAX AUTHORITY IN ACCORDANCE WITH FORM 01/PHLP ISSUED ALONGSIDE CIRCULAR NO. 60/2007/TT-BTC OF JUNE 14, 2007, GUIDING THE IMPLEMENTATION OF CERTAIN PROVISIONS OF THE LAW ON TAX MANAGEMENT AND GUIDING THE IMPLEMENTATION OF DECREE NO. 85/2007/NĐ-CP OF MAY 25, 2007, DETAILING THE IMPLEMENTATION OF CERTAIN PROVISIONS OF THE LAW ON TAX MANAGEMENT.

3.2. NOT LATER THAN THE 25TH DAY OF THE FOLLOWING MONTH, ENTERPRISES OPERATING RAILWAY INFRASTRUCTURE SHALL BE RESPONSIBLE FOR SETTING ASIDE 20% OF THE AMOUNT COLLECTED FROM RENT FOR THE USE OF NATIONAL RAILWAY INFRASTRUCTURE (EXCLUDING VALUE ADDED TAX) TO BE DEPOSITED INTO THE CENTRAL BUDGET ACCORDING TO THE CHAPTER, CATEGORY, ARTICLE, SECTION, AND SUBSECTION OF THE CURRENT STATE BUDGET CLASSIFICATION AT THE STATE TREASURY IN THE RESPECTIVE AREA.

3.3. WHEN COLLECTING RENT FOR RAILWAY INFRASTRUCTURE, ENTERPRISES OPERATING RAILWAY INFRASTRUCTURE SHALL ISSUE A VALUE ADDED TAX INVOICE TO THE LESSEE ON THE ENTIRE AMOUNT COLLECTED BASED ON THE RENTAL PRICE (WITHOUT DEDUCTING THE 20% DEPOSITED INTO THE STATE BUDGET). THE PORTION OF THE 20% DEPOSITED INTO THE STATE BUDGET FROM THE AMOUNT COLLECTED FROM RENT FOR THE USE OF NATIONAL RAILWAY INFRASTRUCTURE SHALL BE CONSIDERED AS REASONABLE EXPENSES WHEN DETERMINING THE INCOME SUBJECT TO CORPORATE INCOME TAX.

3.4. NOT LATER THAN THE 90TH DAY COUNTING FROM THE END OF THE CALENDAR YEAR, ENTERPRISES OPERATING RAILWAY INFRASTRUCTURE SHALL BE RESPONSIBLE FOR FINALIZING THE DECLARATION WITH THE TAX AUTHORITY WHERE THEIR HEADQUARTERS IS LOCATED REGARDING THE AMOUNT COLLECTED FROM RENT FOR THE USE OF NATIONAL RAILWAY INFRASTRUCTURE ACCORDING TO FORM 02/PHLH ISSUED ALONGSIDE CIRCULAR NO. 60/2007/TT-BTC OF JUNE 14, 2007, BY THE MINISTRY OF FINANCE.

IV. MANAGEMENT AND USE OF FEES AND RENT FOR NATIONAL RAILWAY INFRASTRUCTURE FUNDED BY THE STATE.

1. THE ENTIRE AMOUNT COLLECTED FROM FEES FOR THE USE OF NATIONAL RAILWAY INFRASTRUCTURE AND 20% OF THE AMOUNT COLLECTED FROM RENT FOR THE USE OF NATIONAL RAILWAY INFRASTRUCTURE SHALL BE ALLOCATED IN THE ANNUAL BUDGET TO COVER THE COSTS OF MANAGEMENT, MAINTENANCE, AND REPAIR OF THE NATIONAL RAILWAY SYSTEM FUNDED BY THE STATE IN ACCORDANCE WITH THE STATE BUDGET LAW.

2. THE MINISTRY OF TRANSPORT SHALL ASSIGN THE BUDGET FOR THE COLLECTION OF FEES FOR THE USE OF NATIONAL RAILWAY INFRASTRUCTURE AND 20% OF THE AMOUNT COLLECTED FROM RENT FOR THE USE OF NATIONAL RAILWAY INFRASTRUCTURE TO THE RAILWAY CORPORATION AS FOLLOWS:

- TOTAL REVENUE FROM RAILWAY TRANSPORTATION OPERATIONS; TOTAL REVENUE FROM RENTING OUT RAILWAY INFRASTRUCTURE.

- TOTAL AMOUNT COLLECTED FROM FEES FOR THE USE OF NATIONAL RAILWAY INFRASTRUCTURE (8% OF THE REVENUE FROM RAILWAY TRANSPORTATION OPERATIONS) AND 20% OF THE AMOUNT COLLECTED FROM RENT FOR THE USE OF NATIONAL RAILWAY INFRASTRUCTURE TO BE DEPOSITED INTO THE STATE BUDGET.

3. THE MANAGEMENT OF FINANCIAL AFFAIRS, ASSIGNMENT OF PLANS, AND PAYMENT OF CAPITAL FOR ECONOMIC PUBLIC SERVICES FOR STATE COMPANIES PERFORMING PUBLIC TASKS IN THE FIELD OF MANAGEMENT AND MAINTENANCE OF THE NATIONAL RAILWAY SYSTEM FUNDED BY THE STATE SHALL BE IMPLEMENTED IN ACCORDANCE WITH CIRCULAR NO. 136/2007/TT-BTC OF NOVEMBER 28, 2007, GUIDING THE MANAGEMENT OF FINANCIAL AFFAIRS, ASSIGNMENT OF PLANS, AND PAYMENT OF CAPITAL FOR ECONOMIC PUBLIC SERVICES FOR STATE COMPANIES PERFORMING PUBLIC TASKS IN THE FIELD OF MANAGEMENT AND MAINTENANCE OF THE NATIONAL RAILWAY SYSTEM FUNDED BY THE STATE.

V. IMPLEMENTATION

1. THIS CIRCULAR SHALL TAKE EFFECT 15 DAYS AFTER ITS PUBLICATION IN THE OFFICIAL GAZETTE.

2. IF ANY DIFFICULTIES OCCUR DURING IMPLEMENTATION, THE MINISTRIES, SECTORS, LOCALITIES, AND ENTERPRISES ARE URGED TO REPORT PROMPTLY TO THE MINISTRY OF FINANCE FOR STUDY AND GUIDANCE ON RESOLUTION./.