Circular No. 24/2013/TT-BTC guiding the implementation of regulated collection for domestic consumption of oil refining and petrochemical products of PetroVietnam Thanh Hoa Refining and Petrochemical Joint Stock Company (Binh Son)

CIRCULAR

Guidelines for Implementing the Collection of Revenue Adjustment on Domestic Consumption of Oil Products and Petrochemical Products of Binh Son Refining and Petrochemical Joint Stock Company Limited

of the State Capital Corporation

_______________________

Pursuant to Decree No. 118/2008/NĐ-CP dated November 27, 2008, of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Pursuant to Decree No. 84/2009/NĐ-CP dated October 15, 2009 of the Government on gasoline and oil business;

Pursuant to Decree No. 107/2009/NĐ-CP dated November 26, 2009, promulgated by the Government on the business of liquefied petroleum gas;

Pursuant to Decision No. 952/QD-TTg dated July 26, 2012 of the Prime Minister on Certain Financial Mechanisms of Binh Son Refining and Petrochemical Joint Stock Company Limited, State Capital Corporation;

Pursuant to Decision No. 138/QD-TTg dated January 11, 2013 amending and supplementing Clause 2 of Decision No. 952/QD-TTg dated July 26, 2012 on Certain Financial Mechanisms of Binh Son Refining and Petrochemical Joint Stock Company Limited, State Capital Corporation;

Pursuant to the comments of the Ministry of Industry and Trade in Circular No. 10498/BCT-TCNL dated November 1, 2012;

Considering the proposal of the Director of the Department of Tax Policy;

The Minister of Finance issues this Circular guiding the implementation of revenue adjustment collection policies on domestic consumption of oil products and petrochemical products of Binh Son Refining and Petrochemical Joint Stock Company Limited as follows:

Article 1. Object of Revenue Adjustment Collection and Person Paying the Revenue Adjustment

1. The object of revenue adjustment collection is gasoline, diesel, LPG (hereinafter referred to collectively as oil products) and petrochemical products produced and processed by Binh Son Refining and Petrochemical Joint Stock Company Limited (Binh Son Company) for domestic consumption.

2. Binh Son Company is responsible for declaring and paying the revenue adjustment stipulated in this Article into the state budget when selling oil products and petrochemical products domestically.

Article 2. Object and Documentation for Determination of Non-Adjustment Collection

1. Oil products and petrochemical products directly exported or entrusted for export by Binh Son Company.

2. Oil products and petrochemical products sold by Binh Son Company to authorized traders under Decree No. 84/2009/ND-CP dated October 15, 2009 of the Government on Gasoline Business, Decree No. 107/2009/ND-CP dated November 26, 2009 of the Government on Liquefied Petroleum Gas Business, and other enterprises permitted to purchase oil products and petrochemical products from Binh Son Company for export in accordance with the law.

3. Documents serving as the basis for determining non-adjustment collection for cases specified in Clauses 1 and 2 of this Article include: - Approval document of the competent state agency (Ministry of Industry and Trade) regarding permission for exporting oil products and petrochemical products (if applicable). - Export contracts; export entrustment contracts for entrusted export cases; export contracts of authorized traders and enterprises specified in Clause 2 of this Article signed with foreign companies (for export through authorized traders and enterprises permitted to purchase oil products and petrochemical products from Binh Son Company for export in accordance with the law). - Payment documents for exported goods through banks and other documents as prescribed by law. - Customs declaration forms for exported goods. In cases where Binh Son Company does not directly export, quarterly, authorized traders and enterprises permitted to purchase oil products and petrochemical products from Binh Son Company for export in accordance with the law shall be responsible for sending copies of these documents to Binh Son Company for monitoring and management when declaring provisional payment of revenue adjustment.

Article 3. Basis for Revenue Adjustment Collection

1. The basis for calculating revenue adjustment when consuming oil products and petrochemical products domestically as stipulated in Article 1 of this Circular of Binh Son Company is the actual quarterly sales volume of oil products and petrochemical products, the revenue adjustment calculation price, and the revenue adjustment rate.

a) The actual quarterly sales volume of oil products and petrochemical products is the total actual sales volume of each product in the quarter.

b) The revenue adjustment calculation price for oil products and petrochemical products sold is determined based on the actual selling price at the time of sale by Binh Son Company, excluding value-added tax, environmental protection tax, special consumption tax, import tax, and other taxes and fees payable to the state budget (if applicable).

c) The revenue adjustment rate is the difference between the import tax rate of oil products and petrochemical products prescribed at the time of sale minus (-) the preferential value included in the selling price for: gasoline and diesel at 7%, LPG at 5%, and petrochemical products at 3%.

d) The revenue adjustment for oil products and petrochemical products consumed domestically in each quarter is determined by the total revenue adjustment of each actual sale in the quarter. In which, the revenue adjustment of each actual sale of oil products or petrochemical products equals (=) the actual sales volume of oil products or petrochemical products at each sale multiplied (x) by the corresponding revenue adjustment calculation price at each sale multiplied (x) by the revenue adjustment rate at the time of sale of the product.

2. In cases where the import tax rate of oil products and petrochemical products prescribed by the State at the time of consumption of oil products and petrochemical products is lower than the preferential value included in the selling price prescribed for oil products and petrochemical products (7% for gasoline and diesel, 5% for LPG, and 3% for petrochemical products), Vietnam Oil and Gas Group shall pay the difference between the preferential value and the import tax rate to Binh Son Company and record it as pre-tax profit of the Group.

Article 4. Currency for Payment of Collection Adjustment

The currency for payment of the collection adjustment is the Vietnamese Dong.

Article 5. Regulation and budget accounting

1. The regulated revenue from petroleum products and petrochemical products as stipulated in this Circular belongs to the state budget and is fully allocated to the central budget.

2. When remitting the regulated revenue from petroleum products and petrochemical products as stipulated in this Circular, Binh Son Corporation shall record it under Chapter 121, Section 4900, Subsection 4908.

Article 6. Accounting treatment

The regulated revenue that must be paid to the state budget when selling petroleum products and petrochemical products produced and processed for sale by Binh Son Corporation as stipulated in this Circular is deductible expenses when determining corporate income tax for the tax period. Specific accounting entries that Binh Son Corporation shall implement are as follows: + When determining the amount to be paid to the state budget for regulated revenue, debit Account 632 - Cost of Goods Sold, credit Account 3339 - Fees, Taxes and Other Payments Due + When remitting money to the state budget, debit Account 3339 - Fees, Taxes and Other Payments Due, credit Account 112 - Bank Deposits

Article 7. Declaration, Collection, Settlement of Collection Adjustment Amount

1. Quarterly, Binh Son Corporation has the obligation to declare and remit regulated revenue to the state budget according to the model declaration form number 01A and list number 02A issued together with this Circular.

2. Annually, Binh Son Corporation has the obligation to settle the collection and payment of regulated revenue with the tax authority according to the annual settlement declaration form number 01B and list model number 02B issued together with this Circular.

3. The deadline for declaring and remitting regulated revenue quarterly and annually to the state budget shall be implemented as prescribed by the current deadline for submitting tax return documents for corporate income tax.

4. In cases where products have been sold at prices without regulated revenue for export but not exported in the quarter, within 10 days from receiving the confirmation document from the competent state agency regarding the quantity of goods not exported, the main traders and enterprises permitted to purchase petroleum products and petrochemical products from Binh Son Corporation for export according to the law shall be responsible for notifying Binh Son Corporation along with the confirmation document from the competent state agency (Ministry of Industry and Trade) regarding the quantity of goods not exported so that Binh Son Corporation can declare and remit additional regulated revenue corresponding to that quantity. These main traders and enterprises permitted to purchase petroleum products and petrochemical products from Binh Son Corporation for export according to the law shall be responsible for settling payments to Binh Son Corporation based on the domestic sales price of the products so that Binh Son Corporation can declare and remit additional regulated revenue for the unsold goods. Binh Son Corporation shall remit additional regulated revenue for unsold goods no later than the next quarter following receipt of notification from the main traders and enterprises permitted to purchase petroleum products and petrochemical products from Binh Son Corporation for export.

Article 8. Implementation Organization and Effectiveness

This Circular takes effect from the date of issuance and applies from the fiscal year 2012 to the end of the fiscal year 2018. Specifically, the implementation of the payment of the difference between the preferential value and import tax rate for Binh Son Corporation as stipulated in Clause 2, Article 3 of this Circular will commence from 2013 onwards.

From January 1, 2012 until the effective date of this Circular, if Binh Son Corporation has already sold petroleum products and petrochemical products and declared and remitted regulated revenue to the state budget differently from the guidance in this Circular, Binh Son Corporation shall adjust its declaration according to the guidance in this Circular when settling the regulated revenue for the year 2012. The provision in Clause 2, Article 3 of this Circular shall not apply in the fiscal year 2012.

During the implementation process, if there are any difficulties, Binh Son Corporation, Vietnam Oil and Gas Group, and related units are advised to report to the Ministry of Finance for timely guidance and resolution.