Circular No. 38/TC-NSNN guiding the preparation of the State Budget for the year 1997

CIRCULAR

DIRECTIVE NO. 38 TC/NSNN OF THE MINISTRY OF FINANCE ON JULY 18, 1996 GUIDING THE CONSTRUCTION OF THE STATE BUDGET ESTIMATE FOR 1997

Implementing Directive No. 442/TTg dated July 3, 1996 of the Prime Minister on the construction of plans for economic and social development and the state budget estimate for 1997, the Ministry of Finance guides the assessment of the implementation of the state budget in 1996 and the construction and consolidation of the estimate for 1997 as follows:

A- ORGANIZATION AND MANAGEMENT AND ASSESSMENT OF THE IMPLEMENTATION OF THE STATE BUDGET IN 1996:

The situation of implementing the plan for economic and social development in the first six months of 1996, generally achieved satisfactory results: Production, circulation of goods, import and export maintained a relatively high growth rate and developed positively; inflation was controlled; many aspects of society showed positive changes. However, there were still some difficulties that emerged, including: State budget revenue increased but many revenue items were still lower than the initial estimates such as import and export tax, land use rights fee, revenue from the industrial-commercial and service sector outside state-owned enterprises; the situation of tax evasion and smuggling was not effectively curbed; the implementation of basic construction plans was slow; production volume of some products was lower than expected, causing large stockpiles which affected the growth rate and state budget revenue.

To strive to complete and exceed the state budget estimate approved by the National Assembly, ministries and localities shall base themselves on the economic and social targets set out, the state budget revenue and expenditure plan assigned at the beginning of the year, the results of the first six months, assess the implementation of economic and social targets; production and business operations, product consumption and state budget revenue and expenditure throughout 1996 under their management; at the same time propose measures to guide and manage in the last six months to complete the annual plan tasks and serve as a basis for constructing the state budget estimate for 1997. Specifically:

I- On Revenue

1- For state-owned enterprises: Strive to fully exploit production capacity, increase production volume, reduce costs, lower prices, enhance competitiveness, expand market sales...; strictly manage cost and circulation fees, only allowing enterprises to increase the basic depreciation rate with the condition that the unit must ensure tax income to the state budget is not lower than the actual performance in 1995.

2- For enterprises with foreign investment: Organize inspections of the operation of enterprises with foreign investment, especially trade units and representative offices; Inspect and grasp the number of units, pay attention to bringing units that have exceeded the tax exemption and reduction period according to the law into the tax collection scope; area of land, capital and assets allocated, including domestic capital contribution, start date of production and business, production volume, business turnover, taxable entities... to calculate taxes according to the Law and the investment permit regulations.

3- Localities coordinate with customs and tax authorities to strictly inspect import and export procedures (quantity, value, type of goods) to calculate taxes; strengthen inspection against smuggling and tax evasion, including imported goods already in the domestic market without proof of full payment of import duties; implement measures to compel units to immediately pay into the state budget any overdue taxes.

4- For the small-scale industry, commercial and service sector outside state-owned enterprises and private enterprises: Organize inspections of business licenses, business locations, business activities, actual number of businesses, and tax registration situations... Revoke business licenses for those operating outside their licensed business scope, those who fail to register and declare taxes, particularly private enterprises; implement comprehensive inspections and adjust revenues to bring all actual operating businesses under management and taxation, adjust revenues closely to market prices and production scale, based on which calculate taxes according to the Law, especially large-scale businesses in sectors such as commerce, services, hotels, construction, transportation...

5- For agricultural land use tax: Based on the tax records, determine the amount due to the state budget for timely collection. Review and grasp the area of agricultural land, the managed tax area, the area exempted from tax, and the additional area to be managed for tax purposes. Regarding the rice price for tax calculation: Localities base on market prices and refer to regional rice prices to determine the appropriate and close-to-market rice tax price.

6- For revenue from houses and land: Localities focus on grasping the land fund in each commune and ward, with planning and usage plans, on this basis promote the sale of state-owned housing, grant land use rights according to regulations, striving to achieve and exceed the National Assembly's approval to create investment sources for infrastructure; calculate and collect house and land taxes, land use fees, and land rental fees according to the prescribed system.

7- For other state budget revenues: Base on actual occurrences, fully and promptly collect into the state budget, analyze and explain clearly each recurring and non-recurring revenue item between years to calculate the 1997 estimate.

After evaluating the implementation of state budget revenue collection for the first six months of the year, it is estimated that the state budget revenue for the entire year will be based on measures to increase revenue in the last six months, recover all outstanding revenues from the 1995 final settlement, and those outstanding in the first six months of this year; collect fully and promptly all revenues due to the state budget that arise in the last six months of the year. Analyze the results of the annual budget revenue collection, identify the factors affecting state budget revenue in 1996 to serve as the basis for calculating the 1997 budget estimate, such as: production and business conditions; economic growth rate; changes in economic structure and product structure; price effects; mechanism and policy impacts; management impact on revenue collection, compliance with revenue payment regulations... The evaluation of the annual state budget revenue collection must clearly analyze the results of each tax type for each economic sector to serve as the basis for calculating the分级管理预算的分级管理。

II - Regarding expenditures

Based on the annual tasks assigned, progress, and actual implementation of the tasks, it is necessary to estimate the expenditure of the state budget to ensure compliance with the established system and assigned tasks, limit unnecessary purchases and repairs, practice thrift to prioritize funding for essential and effective tasks. The assessment must thoroughly analyze achievements, unfulfilled tasks, wasteful areas, identify causes, and develop measures for implementation in the last six months of the year and serve as the basis for calculating the 1997 budget estimate. Among these, attention should be paid to several measures:

1. From now until the end of the year, no additional state budget expenditures outside the plan shall be approved, except in cases of urgent necessity such as disaster prevention and flood control. Ministries, sectors, localities, and units must practice thrift, rearrange their spending tasks to ensure funding for newly emerging essential needs. For expenditures already decided but not included in the initial budget plan, they should be reviewed to delay the schedule and arrange them in the 1997 budget estimate.

2. Regarding basic construction: Review the list and funds allocated to projects in the initial plan, ministries, sectors, and localities should focus on implementing the investment construction plans assigned, complete the necessary procedures for construction investment to serve as the basis for capital allocation. For the completed construction volume in 1995 that has not been settled, use the 1996 plan funds to settle completely. For the 1996 plan, based on the assessment of the volume implemented in the first six months and the ability to implement throughout the year, the amount already disbursed and the potential for disbursement in the last six months, determine the volume to be transferred for settlement in 1997 for each project. Projects exceeding the plan by December 31, 1996, must be arranged in the 1997 plan to have the source for settlement; projects not completing the plan, if continued, must be arranged in the 1997 plan.

3. Regarding national programs: Prioritize funding for national programs according to the plan and progress, estimate the full-year implementation based on this, and clearly analyze each source of funding (state budget, aid, credit, public contributions...). The program's main authority organizes a comprehensive evaluation of the effectiveness of each program: objectives to be achieved; implementation time; content; results up to the end of 1996..., from which specific recommendations about management mechanisms and program reorganization are made.

4. Regarding regular expenditures: Based on the initial plan, the progress of tasks, and budget capacity, estimate the full-year implementation closely aligned with the actual situation of the Ministry, locality, and permitted revenue sources. Each expenditure area analyzes in detail the salary structure, salary allowances, mandatory expenditures based on salaries, regular operational expenditures, and unexpected expenditures (such as procurement, repairs, famine relief, disaster response...) to serve as the basis for arranging the 1997 budget estimate.

5. Regarding infrastructure investment expenditures of localities from land use rights revenue, housing sales revenue, lottery revenue, agricultural land use tax, localities should base their revenue situation to allocate and distribute expenditures appropriately. In cases where revenue does not meet the plan, reduce expenditures accordingly, only implement expenditures when there is actual revenue to avoid unpaid volumes without settlement sources.

III- For state budget revenues, according to the unit's retained self-expenditure system or part thereof; revenues determined by the Government's decision to be reinvested in ministries and localities, such as traffic violation fines, smuggling penalties; surcharges on electricity and postal services... to increase investment in the power and postal sectors: ministries and localities instruct units to carefully evaluate revenue and expenditure implementation according to the general state system, analyze compliance with revenue collection and expenditure content over recent years to propose amendments and supplements to the mechanism for 1997 and subsequent years in accordance with the State Budget Law.

Based on the estimated annual revenue and expenditure of the state budget in 1996, ministries and localities organize evaluations of the implementation of economic and social indicators and the state budget from 1991 to 1996, highlight achievements, shortcomings, existing issues, and analyze specific reasons, focusing on deeply reviewing strengths and weaknesses in budget allocation and management. From this, tasks are proposed and lessons are drawn for building and directing the 1997 budget estimate and subsequent years.

B- BUILDING AND COMBINING THE STATE BUDGET ESTIMATE FOR 1997:

In 1997, the second year of the five-year plan from 1996 to 2000, it is the year to implement the Resolution of the Eighth Party Congress and enforce the State Budget Law. The situation in previous years and 1996 shows some fundamental advantages:

The economy continues to stabilize and develop at a relatively good pace; inflation has been controlled and shows a decreasing trend. New economic management mechanisms are demonstrating positive results, and the system and legal texts on state budget revenue and economic-social management have been issued relatively comprehensively and are now exerting their effects.

However, entering 1997 also brings about some difficulties, namely:

- State budget revenue, especially export taxes and import taxes over recent years, has not met plans, leading to a large amount of domestic debt accumulated from previous years that the state budget has yet to settle for investment development.

- Requirements for investment construction expenditure and expenditure on education, healthcare, culture, social welfare, and national defense security are all significant, aiming to create conditions for both high-speed and sustainable economic growth and improving and developing cultural-social fields better. Meanwhile, the gross domestic product and financial resources remain limited.

- The structure of salary expenditure, salary-like allowances, expenditure for retirees, those with reduced labor capacity, and other social policy beneficiaries in the state budget is too large due to the large number of civil servants, party organizations, and mass organizations, particularly in the public service sector funded by the state budget, and the long-term consequences of the socialist supply system regarding social insurance are heavy burdens on the state budget. Although the wage fund is large, the actual wage levels of those receiving salaries and social benefits have decreased due to inflation, necessitating solutions.

Based on the tasks of the five-year plan from 1996 to 2000 and the advantages and difficulties mentioned above, the preparation of the state budget for 1997 must meet the following objectives and requirements:

1- The state budget for 1997 must be allocated to effectively implement the socio-economic development goals set forth in Resolution VIII; implement the 11 programs and areas of development effectively; continue to create a favorable environment for the economy to develop at a high and sustainable pace, gradually shifting the economic structure throughout the national economy as well as in each industry and region towards industrialization and modernization, closely linked to the implementation of the program to stabilize the socio-economic situation firmly. Study and promulgate mechanisms and implement measures to strongly socialize cultural-social fields; for each field, select key targets to prioritize investment to bring about new changes in culture, arts, broadcasting, television, health care for the people, population work, family planning, and other social aspects, especially creating strong development in education and training to achieve the goal of raising literacy and improving the quality of human resources to meet current and long-term needs.

Forecasting some indicators of economic growth in 1997 compared to 1996 as follows:

- Gross Domestic Product (GDP) will increase by 9-10%;

- Agricultural, forestry, and fishery production value will increase by 4.5-4.9%;

- Industrial production value will increase by 14-15%;

- Service sector production value will increase by 12-13%;

- Total export turnover will increase by 28%;

- Total import turnover will increase by 23%.

2- Stabilize and consolidate the purchasing power of the currency; keep inflation at a lower level than the rate of economic growth to facilitate stable economic development at a higher speed (projected price increase index for 1997 below 10%, exchange rate between the Vietnamese dong and US dollar at 11,000 VND/USD).

3- Tax policies have lowered the collection rate; exempting and reducing taxes for businesses operating in mountainous areas, remote regions, enterprises owned by war invalids, disabled persons, etc. Therefore, measures must be taken to collect taxes fully according to the Law and exploit all sources of income, prevent loss of revenue; ensure reasonable and frugal regular expenditure needs and repay debts according to commitments and prioritize investment development.

4- All revenues and expenditures of the state budget must be reflected entirely in the state budget estimate and managed through the National Treasury, including fees, charges, and other revenues previously retained by units for their own use; incorporate all foreign loans of the Government and aid into the state budget revenue-expenditure balance for management and monitoring of debt repayment, including loans made by the Government for onward lending.

5- Prioritize investment development, especially investment in building economic-social infrastructure, following the guideline of allocating approximately 70% of tax and fee revenues for regular expenditure, 30% for investment development and debt repayment. Allocate expenditure first ensuring priority for education and training and ensuring key areas for other sectors; strive to prioritize investment in remote, ethnic minority regions.

6- Allocate funds based on the spirit of thrift, limit the purchase of expensive equipment, and carefully calculate the balance when constructing headquarters in each locality.

7- Arrange additional financial reserve funds to proactively manage the budget. Set aside a reasonable budget reserve according to the State Budget Law to meet the needs of new policies and unexpected expenditures. 8- The budget deficit must correspond to the ability to borrow domestically and obtain preferential foreign loans. Do not borrow commercially abroad, do not issue and borrow domestically short-term, high-interest loans to cover the budget deficit. The budget deficit level (excluding foreign loans for onward lending) must be below 3% of GDP.

II. Main contents in calculating state budget revenue items for 1997

Ministries, localities, based on the situation of state budget revenue submission and business results in 1996, the production and business capacity of grassroots units in 1997; based on existing legal texts on revenue to prepare the state budget revenue estimate for 1997 on the basis of economic growth rate (9-10%), price increase index under 10%, increased efficiency in production and business operations, and the ability to prevent revenue loss, the target for the 1997 revenue estimate must reach an average increase of 20-22% compared to the actual performance in 1996. During the calculation process, pay attention to the following points:

1- For the state-owned economic sector:

- Regarding turnover tax: Calculated according to Circular No. 97 TC/TCT dated December 30, 1995 of the Ministry of Finance guiding the implementation of the Turnover Tax Law and the Law amending and supplementing certain articles of the Turnover Tax Law.

- The reduction of business income tax for the year 1996 for businesses located in mountainous areas: The objects eligible for reduction, the extent of reduction, and the duration of the tax reduction shall be applied according to Circular No. 24 TC/TCT dated May 10, 1996, issued by the Ministry of Finance on the reduction of business income tax for the year 1996 for businesses located in mountainous areas for the state budget in 1997 pending the government's directive to temporarily calculate the specific amount of tax reduction for each case according to the above circular, fully explaining the tax reduction for the year 1996 and the estimated amount for 1997.

- Calculate the impact of increasing or decreasing revenue from implementing the Law on Encouraging Domestic Investment. Specifically determine the increase in revenue due to the enhanced production and business capacity of new enterprises; investment in expanding production and business activities.

- Regarding special consumption tax: Calculated according to Circular No. 98 TC/TCT dated December 30, 1995, issued by the Ministry of Finance detailing the implementation of the Special Consumption Tax Law and laws amending and supplementing certain provisions of the Special Consumption Tax Law. Revenue is collected at the place of production.

- Regarding the use of state budget capital: Based on the situation of circulating capital up to the end of 1996; the situation of increases and decreases in fixed assets, the amount of capital left for units to self-invest from state sources; the annual preservation of capital... re-determine the state budget capital to calculate revenue according to regulations. For the capital that enterprises have borrowed from the state in joint ventures and cooperation contracts with foreign countries such as the value of factories, construction projects, land rental fees, water surface rental fees, intangible fixed assets... all must be calculated as revenue from the use of state budget capital according to the guidance provided in Circular No. 19-TC/TCĐN dated June 9, 1992, issued by the Ministry of Finance, with a tax rate of 3% per annum.

- Regarding basic depreciation: Based on determining the original cost of fixed assets through projected increases and decreases during the year; the level of basic depreciation calculated according to Decision No. 507 TC/ĐTXD dated July 22, 1986, issued by the Ministry of Finance and supplementary guiding documents. Direct units to increase the depreciation rate compared to the basic rate if they meet the conditions stipulated in Decision No. 51/TTg dated January 21, 1995, issued by the Prime Minister, and Circular No. 36 TC/TCDN dated April 27, 1995, issued by the Ministry of Finance, while ensuring that the profit tax paid is not lower than the actual payment in 1996.

- Regarding profit tax: Calculate taxable profit based on accurately and sufficiently accounting for production and business costs according to regulations. Particularly, units with large profits due to objective reasons must pay additional profit tax as prescribed by law. When determining taxable profit for 1997, note the carryover losses from previous years as allowed by regulations; fixed assets that have been fully depreciated but are still in use cannot be included in cost prices or circulation expenses.

2- For enterprises with foreign invested capital:

The tax department will closely coordinate with provincial-level People's Committees, the state asset management system within enterprises, and related sectors to thoroughly grasp the number of units that have been granted licenses in the province, the number of units that have commenced operations, the number of units whose tax exemption and reduction periods have expired, and the expected number of new units to commence operations in 1997, as well as the production and business scale of each enterprise to accurately and sufficiently calculate revenues according to the law and the investment license regulations for each enterprise. In calculating revenue, it is necessary to note:

- Regarding the recovery of state budget capital: Enterprises that have borrowed from the state according to the guidance provided in Circular No. 19 TC/TCĐN dated June 9, 1992, issued by the Ministry of Finance, the Tax Department must develop a plan to recover state budget capital for the state's contribution to joint ventures.

- For cases involving the transfer of capital contributions by investors in foreign-invested enterprises and cooperation contracts under the Foreign Investment Law, profit tax must be calculated according to Circular No. 96 TC/TCT dated December 30, 1995, issued by the Ministry of Finance.

- Taxation of foreign contractors operating in Vietnam not under the Foreign Investment Law: Review organizations and individuals from foreign countries engaged in business activities in Vietnam. Accurately grasp the total investment capital and the start date of construction projects within the jurisdiction to include them in the tax revenue plan for business income tax and profit tax for foreign contractors according to the guidance provided in Circular No. 37 TC/TCT dated May 10, 1995, issued by the Ministry of Finance.

3- For the small-scale industry, trade, service sector outside the state-owned sector, and private enterprises:

Based on the implementation situation in 1996 and through investigations to determine the actual number of households engaged in production and business activities, calculate the taxable turnover to estimate revenue for 1997. Note the following when estimating revenue:

- Include all actual households engaged in production and business activities in registration and tax management.

- Based on the investigation of taxable turnover, accurately determine the taxable turnover, taking into account the potential development of production and business activities in 1997 and price trends to calculate the average taxable turnover for 1997 as the basis for calculating taxes for this sector; pay attention to preventing revenue loss from enterprises established under the Company Law, especially those with large scales, hotels, restaurants...

- For the transfer of capital by investors in enterprises established under the Company Law and the Private Enterprise Law, calculate profit tax according to the guidance provided in Circular No. 96 TC/TCT dated December 30, 1995, issued by the Ministry of Finance.

- Collection of stamp duty: Calculate revenue according to the stamp duty collection ratio specified in Decree No. 193-CP dated December 29, 1994, issued by the Government regarding stamp duty. Pay particular attention to including in the revenue plan cases where motorcycles, river and sea vessels are sold without completing legal procedures; cases where the state allows regularization of property ownership rights and land use rights for transactions previously conducted through multiple owners without full procedures. For assets registered as owned that are transferred for joint venture contributions, stamp duty must be paid according to the guidance provided in Circular No. 93 TC/TCT dated December 21, 1995, issued by the Ministry of Finance.

4- Agricultural land use tax:

BASED ON THE AGRICULTURAL LAND USE TAX LAW, GUIDING DOCUMENTS FOR THE LAW, AND THE TAX REGULATIONS THAT HAVE BEEN ESTABLISHED TO CALCULATE COLLECTION. NOTE THE ADDITIONAL CALCULATION FOR AREAS THAT WERE EXEMPT OR REDUCED IN TAXES UNTIL 1997 AND ARE NOW SUBJECT TO TAXATION; FULLY CALCULATE THE TAX FOR OBJECTS AND AREAS THAT MUST BE TAXED EXCEEDING THE LIMIT.

REGARDING THE RICE PRICE USED TO CALCULATE THE AGRICULTURAL LAND USE TAX: BASED ON THE CURRENT MARKET PRICE AND THE PROJECTED PRICE INDEX FOR 1997 FOR EACH GROUP OF AGRICULTURAL PRODUCTS TO DETERMINE THE APPROPRIATE PRICE, ENSURING IT IS NOT LESS THAN 10% OF THE LOCAL MARKET PRICE.

5- FOR CHARGES AND FEES:

FORECAST FOR 1997 SHOULD BE CLOSE TO THE ACTUAL SITUATION OF EACH MINISTRY, LOCALITY, AND UNIT ACCORDING TO THE CURRENT COLLECTION SYSTEM. IN THE CALCULATION, PAY ATTENTION TO:

- FULLY CALCULATE ALL CHARGES AND FEES PERMITTED BY THE STATE. DO NOT COLLECT AND SHALL NOT COLLECT ANY CHARGES AND FEES SELF-IMPOSED BY MINISTRIES, LOCALITIES, AND BASIC UNITS CONTRARY TO THE GENERAL PROVISIONS OF THE STATE. THESE ITEMS MUST BE HANDLED OR REPORTED TO THE AUTHORIZED AUTHORITIES FOR HANDLING AS PROVIDED. BASED ON THE ACTUAL IMPLEMENTATION SITUATION, RECOMMENDATIONS FOR AMENDING AND COMPLETING THE COLLECTION OBJECTS AND RATES TO BE REASONABLE.

- STRICTLY FOLLOW CIRCULAR NO. 46 TC/TCT DATED JUNE 24, 1993, REFLECTING ALL CHARGES AND FEES INTO THE STATE BUDGET FROM THE PLANNING STAGE THROUGH THE MANAGEMENT AT THE NATIONAL TREASURY, INCLUDING THOSE CHARGES AND FEES ALLOWED TO BE RETAINED BY THE UNIT FOR EXPENSES (THE EXPENSE BUDGET FROM THIS SOURCE ALSO NEEDS TO BE FULLY CALCULATED AND REFLECTED IN THE UNIT'S EXPENSE BUDGET).

- MINISTRIES, LOCALITIES, AND UNITS MUST CALCULATE AND PROVIDE A DETAILED EXPLANATION FOR EACH CHARGE AND FEE ITEM ACCORDING TO THE LIST AND THE AMOUNT COLLECTED OVER SEVERAL YEARS AND THE PROJECTED AMOUNT FOR 1997; THE SITUATION OF USE (DEPOSITED INTO THE STATE BUDGET, RETAINED BY THE UNIT FOR EXPENSES). SPECIFICALLY CALCULATE AND REPORT SEPARATELY THE LIST AND AMOUNT OF CHARGES AND FEES FOR COMMUNES AND WARD.

6- FOR INCOME FROM HOUSES AND LAND:

- THE LAND USE RIGHT TRANSFER TAX IS CALCULATED ACCORDING TO CIRCULAR NO. 78 TC/TCT DATED SEPTEMBER 30, 1994, ISSUED BY THE MINISTRY OF FINANCE.

- THE MONEY FOR LAND TAX: CALCULATED ACCORDING TO DECREE NO. 18/CP DATED FEBRUARY 13, 1995, ISSUED BY THE GOVERNMENT DETAILING THE IMPLEMENTATION OF THE ORDINANCE ON RIGHTS AND OBLIGATIONS OF DOMESTIC ORGANIZATIONS GIVEN LAND BY THE STATE AND LETTER NO. 1546 TC/TCT DATED MAY 13, 1996, ISSUED BY THE MINISTRY OF FINANCE GUIDING THE COLLECTION OF MONEY FOR LAND TAX, SPECIFICALLY:

+ THE AREA FOR LEASED LAND PAYMENT: FOR UNITS ALREADY GRANTED LEASED LAND BY THE COMPETENT STATE AUTHORITY, THE AREA FOR LEASED LAND PAYMENT IS THE AREA STATED IN THE DECISION OF THE COMPETENT AUTHORITY; FOR UNITS CURRENTLY USING LAND FOR PRODUCTION AND BUSINESS AND CURRENTLY PAYING LAND TAX, TEMPORARILY USE THE AREA USED FOR CALCULATING THE LAND TAX.

+ THE LEASED LAND RATE IS CALCULATED ACCORDING TO ARTICLES 2 AND 6 OF THE FRAMEWORK PRICES FOR LEASED LAND ANNEXED TO DECISION NO. 1357 TC/QĐ/TCT DATED DECEMBER 30, 1995, ISSUED BY THE MINISTER OF FINANCE.

- THE MONEY FOR SELLING HOUSING IS CALCULATED ACCORDING TO DECREE NO. 61/CP DATED JULY 5, 1994, ISSUED BY THE GOVERNMENT ON HOUSING PURCHASE AND SALE AND DECREE NO. 21/CP DATED APRIL 16, 1996, AMENDING AND SUPPLEMENTING ARTICLES 5 AND 7 OF DECREE NO. 61/CP.

7- REGARDING EXPORT AND IMPORT TAXES:

PROJECT THE COLLECTION OF EXPORT AND IMPORT TAXES FOR 1997 BASED ON THE PLAN FOR EXPORT AND IMPORT VOLUMES, THE STRUCTURE OF QUANTITIES OF GOODS FOR EXPORT AND IMPORT, THE CURRENT TAX RATES, AND THE TAX CALCULATION PRICES FOR EACH GROUP AND ITEM CLOSE TO THE MARKET.

CALCULATE SEPARATELY THE AMOUNT OF PENALTIES AND CONFISCATED GOODS FROM SMUGGLING; CUSTOMS FEES; ADDITIONAL FUNDS FOR PRICE STABILIZATION.

8- OTHER INCOMES OF THE STATE BUDGET:

BASED ON THE IMPLEMENTATION SITUATION OF PREVIOUS YEARS, ESTIMATE THE IMPLEMENTATION OF 1996 TO PROJECT THE COLLECTION FOR 1997 ON THE BASIS OF STRIVING TO INCREASE COLLECTION, MAXIMIZE COLLECTION, COLLECT ACCORDING TO THE REGULATIONS, AND COLLECT FULLY FOR THE STATE BUDGET.

9- REGARDING FOREIGN LOANS AND ASSISTANCE:

MINISTRIES AND LOCALITIES BASE THEIR CALCULATIONS ON APPROVED PROJECTS, AGREEMENTS SIGNED WITH ABROAD THAT CAN BE DRAWN DOWN IN 1997; BASED ON THE IMPLEMENTATION SITUATION OF EACH PROJECT AT THE END OF 1996 TO CALCULATE AND BUILD THE PLAN FOR LOANS AND ASSISTANCE IN 1997. THEREBY:

- ANALYZE IN DETAIL FOR EACH PROJECT: TOTAL AMOUNT OF LOANS AND ASSISTANCE, TIMEFRAME FOR IMPLEMENTATION, VOLUME COMPLETED BY THE END OF 1996, PROJECTED IMPLEMENTATION AND DRAWDOWN IN 1997.

- ANALYZE ACCORDING TO THE CAPITAL STRUCTURE OF EACH PROJECT: IN CASH, IN GOODS, TECHNOLOGY TRANSFER, EXPERTS, TRAINING...

- ANALYZE ACCORDING TO THE PURPOSE OF USE: FOR DISTRIBUTION OF INVESTMENT IN CONSTRUCTION, FOR REGULAR EXPENSES FOR ADMINISTRATIVE AND PUBLIC SERVICES (EDUCATION, HEALTH, CULTURE...), FOR LOANS.

- PROJECT THE PLAN FOR 1997 INTO TWO LISTS: PROJECTS AND TOTAL AMOUNTS CERTAINLY IMPLEMENTABLE IN 1997; PROJECTS AND TOTAL AMOUNTS WITHOUT CERTAIN CAPABILITY.

THE STATE BUDGET INCOME BUDGET ON THE TERRITORY MUST BE ANALYZED IN DETAIL: ACCORDING TO EACH TAX TYPE FOR DIFFERENT ECONOMIC COMPONENTS; TYPES OF FEES AND CHARGES MANAGED BY THE CENTRAL LEVEL, BY PROVINCES, CITIES, DISTRICTS, COUNTIES, BY COMMUNES, WARDS, TOWNS; INCOMES UNDER THE REGIME ALLOWED TO BE RETAINED PARTIALLY OR WHOLLY BY THE UNIT FOR EXPENSES; OTHER INCOMES OF EACH BUDGET LEVEL... TO SERVE AS THE BASIS FOR BUDGET MANAGEMENT DECENTRALIZATION.

III. MAJOR CONTENTS IN THE CALCULATION OF THE STATE BUDGET EXPENSES IN 1997.

1- BASIC CONSTRUCTION INVESTMENT EXPENSES:

BUILD THE PLAN FOR THE LIST OF BASIC CONSTRUCTION INVESTMENT PROJECTS ACCORDING TO THE SOURCES OF FUNDS:

+ STATE BUDGET ALLOCATION INCLUDING BOTH THE CONCENTRATED INVESTMENT FUNDS FOR BASIC CONSTRUCTION AND FUNDS FROM LOTTERY SALES, AGRICULTURAL LAND USE TAX ON RICE, LEASED LAND PAYMENTS, AND THE SALE OF STATE-OWNED HOUSING...

+ FOREIGN LOANS OR ASSISTANCE.

+ PREFERENTIAL CREDIT FROM THE STATE.

+ CREDIT WITH NORMAL INTEREST RATES.

+ JOINT VENTURES WITH DOMESTIC UNITS.

+ JOINT VENTURES WITH FOREIGN UNITS AND FOREIGN DIRECT INVESTMENT.

+ OWN CAPITAL OF THE UNIT.

+ STATE FUNDS LEFT FOR THE UNIT TO INVEST ON ITS OWN (INCLUDING INVESTMENT FROM THE STATE BUDGET, PROFITS RETAINED AFTER TAX ACCORDING TO THE REGULATIONS).

The State budget capital mainly invests in infrastructure projects that cannot recover costs; project lists are arranged according to target groups, by each source of capital, for specific purposes, and prioritized in order. Only projects with complete investment procedures as prescribed shall be included in the plan; projects included in the plan must have guaranteed sources of funding; priority is given to ensuring sufficient funds to settle completed construction investment volumes from before 1996 that have not yet been settled, providing corresponding capital for foreign-invested projects, ongoing projects to put into use as soon as possible according to approved schedules, avoiding scattered and inefficient investments; for newly commenced projects, careful consideration is required, only allocating capital for truly important and urgent projects; limiting investment in headquarters buildings.

The detailed budget for construction investment in 1997 is established for each project by each source of capital mentioned above and divided into two categories: ongoing projects and newly commenced projects. Each project needs to clearly analyze:

- Completed volumes carried over from previous years to be settled in 1997.

- Volumes to be implemented in 1997.

- Volumes to be carried over to 1998 for settlement.

For projects funded by sources such as land use rights fees, housing sales revenue, lottery proceeds, agricultural land use tax for rice cultivation, surcharges; a portion of profits retained by Vietnam from crude oil exploitation for PetroVietnam... must also establish a budget expenditure plan and can only be implemented when all investment procedures under current regulations on investment capital management and construction are complete, and must be based on the progress of corresponding revenue sources.

2- Regarding working capital allocation:

In the budget and operational planning, priority is given to new enterprises; processing enterprises of agricultural products and food, construction material production enterprises, export goods production enterprises... operating effectively, strictly adhering to state budget revenue and expenditure regulations, including social insurance and health insurance contributions as stipulated... Working capital allocation plans are made after proposing measures to adjust surplus to shortage areas.

3- Reserve expenditures:

Ministries, localities, and units assigned by the Government to reserve essential materials and goods for the nation and circulation reserves to stabilize prices must conduct inventory checks and reassess the quality and quantity currently available. Based on actual conditions, the list of national reserve items specified in the National Reserve Management Regulation issued together with Decree No. 10/CP dated February 24, 1996, and the requirements for reserves submitted to the Government regarding the types and quantities of items needed to be reserved, plans for exchanging or selling surplus items not needed for reserves, and plans for increasing reserves. The state budget allocates a budget for increasing reserves upon decision by the Government.

4- Subsidies for policy items:

- For policy items transported to mountainous regions to serve ethnic minorities: The target groups, items, and distance for transportation subsidies are applied according to Government Circular No. 1960/KTTH dated April 15, 1994, on certain policies for transporting goods to mountainous regions to serve ethnic minorities, Government Circular No. 7464/KTTH dated December 30, 1995, on transportation subsidy policies for goods transported to mountainous regions, and related ministry and sector guidelines; the subsidy rate is calculated according to the regulations of the Government Price Board.

Ministries and localities base their estimates of purchase locations for calculating the 1997 subsidy budget on actual conditions and the mechanism above; the budget must clearly explain: Number of beneficiaries, consumption volume, transport distance, subsidy rate. For iodized salt, it is included in the national program for preventing goiter.

Subsidies for seedling preservation, livestock, poultry, press subsidies, publishing house subsidies... are implemented according to current regulations; ministries and localities carefully calculate and clearly determine the quantity, cost, transportation expenses..., specific subsidy rates for each item, seedling, newspaper, and publishing house according to the correct regulations.

5- Administrative and public service expenditures:

The 1997 budget estimate must be based on a thorough analysis of the implementation in 1996, eliminating expenditures not in accordance with policy and regulations, and one-off expenditures of 1996; implementing thrift and waste reduction. Priority is given to allocating funds for salaries and other expenditures linked to salaries; for regular business operation expenditures, allocate at the minimum necessary level; other expenditures such as procurement, repairs, sending delegations out, welcoming delegations in... are allocated according to budget balance capacity; minimize the purchase of expensive assets that are not urgent; limit meetings, reviews, summaries...

The budget is established for each grassroots unit and detailed by items: Salaries; Mandatory expenditures based on salary (Social Insurance, Health Insurance, Trade Union Fees...); Regular business operation expenditures; Sending delegations out and welcoming delegations in; Procurement and repair expenditures (detailed by item and prioritized for each subordinate unit); Expenditures in Vietnamese currency and foreign currency. Foreign currency expenditures are calculated at a rate of 11,000 VND/USD. In planning considerations:

- Administrative and public service expenditure levels: Calculated according to the level in Appendix 1 attached to this Circular.

- Salaries: Calculated according to current regulations, including annual salary increments. For mandatory expenditures based on salary: Social Insurance calculated at 15% of the salary fund (employer contribution), Health Insurance calculated at 2% of the salary fund (employer contribution), Trade Union Fees temporarily calculated at 2% of the salary fund.

- Items decided by the Government but not implemented in 1996 or to be implemented in 1997 need to be included in the budget to ensure proactive management, avoiding omissions when implementing and having to request supplementary budgets outside the original budget.

- Do not include expenditures determined by sectors and localities outside the general state regulations; Ministries may not estimate support expenditures for localities, while localities may not estimate support expenditures for central ministries and sectors contrary to budget management decentralization and the State Budget Law.

- Allocation must be made on the principle of thorough thrift, limiting expenditures for expensive purchases such as small cars, air conditioners, etc. - New construction projects, renovations, and repairs funded by public service funds or national target program budgets must comply with Decision No. 92/TTg dated March 7, 1994 of the Prime Minister regarding enhanced management to prevent waste, loss, and corruption in investment and construction, and current regulations on investment and construction management. Only new construction projects or major renovations and repairs that have been approved according to regulations shall be included in the plan.

- Economic service expenses: Allocate resources prioritizing tasks serving agricultural development, transportation, with particular attention to mountainous and remote areas. Clearly analyze the content of each task to be carried out and arrange them in order of priority; specify the bases for calculation, such as: volume of work to be performed, economic and technical norms, expenditure rates, and total expenditure.

- Education and training expenses: Plan allocation in conjunction with rational restructuring of school networks and the policy of socializing education and training. Adequately account for tuition fees, mobilize people's contributions, and other revenues to invest in education and training. Clearly specify the bases for calculation, such as: population by region, number of students present, new enrollments, graduates, average number of students; expenditure rates and total expenditure for each level of education (general education; university, college, and postgraduate; secondary vocational training; vocational training; retraining and upgrading).

- Health service expenses: Allocate expenses based on restructuring health care facilities, promoting and expanding the scope of health insurance implementation, effectively utilizing hospital fee revenues to ensure funding requirements; clearly analyze preventive and curative expenses, sources ensuring health care funding (government budget allocations, hospital fees, health insurance, aid...).

- Cultural and information service expenses: Ministries and localities must review their tasks and programs to ensure practicality and effectiveness while actively tapping into revenue sources. Prioritize funding for radio and television broadcasting coverage nationwide and gradually improve the quality of artistic programs, broadcasting quality, and basic cultural and information tasks.

- Science, technology, and environmental expenses:

Prioritize funding for national programs and topics under the five-year plan from 1996 to 2000.

For ministry, sector, and locality-level topics: Only allocate funds for fundamental science and social and political science topics. Topics directly serving production should be funded from unit science development funds or through orders from enterprises.

For trial production and testing projects: Evaluate project implementation effectiveness; total investment in projects from 1991 to date, amount to be recovered in 1997 according to regulations. Based on this, use recovered funds from old projects to fund new projects in 1997; starting from 1997, no additional state budget funds will be allocated to support trial production and testing projects.

Other expenses, such as administrative operation costs for scientific agencies, international cooperation expenses..., shall be allocated according to current regulations.

- Pension and social assistance expenses: Calculate and explain clearly the number of beneficiaries (old beneficiaries, new beneficiaries), expenditure rates according to current regulations. For pension and disability benefits due to occupational diseases, the state budget ensures payment for those retiring before December 31, 1994; for those retiring from January 1, 1995 onwards, the social insurance fund ensures funding for payments.

- Administrative management, Party, and mass organization expenses: Calculate based on approved staffing levels and average expenditure rates for each area. For localities, when planning, separately allocate state administration management expenses; Party budget expenses; support expenses for mass organizations and people's associations.

For special expenses specific to each sector, such as uniform expenses according to regulations, expenses for enforcement work, medal production... detailed explanations of implementation in 1996 and projections for 1997 for each expense item must be provided.

- For expenses from fees and charges retained by units according to regulations, these units must prepare budgets like other expenses, following the expenditure guidance in this circular and reflecting them in the unit's budget revenue and expenditure forecast.

6- Regarding national programs:

- The managing agency of the national program shall evaluate the effectiveness of implementation up to the end of 1996; review the content of each program, implementation period, results achieved (both tasks and funding), total investment amount (divided by sources)... and rearrange each program's objectives in the direction: Objectives important for national socio-economic development, inter-sectoral in terms of impact and implementation, shall be balanced in the state budget, centrally directed and managed, but planned and assigned to localities for implementation; objectives of a recurring nature, such as anti-degradation, procurement, repair, objectives specific to sectors and localities shall be directly balanced into the regular expenses of ministries and localities for ministries and localities to proactively implement.

- Prioritize funding for programs according to the approved overall plan. Do not expand additional programs.

Specifically for the "Job Creation Loan" program, the "Afforestation of Bare Hills" program, and the "Vacant Land in Plain Areas and Coastal Reclaimed Land" program, the managing agency of the program shall review the total capital invested, including the total loan amount recoverable, propose the total outstanding loan amount of the program to have a basis for allocating supplementary funds in 1997.

7- Regarding other expenses:

Base calculations on the specific situation of each unit, each ministry, and locality to ensure correct expenditure according to regulations, thrift, and detailed explanation of estimated implementation in 1996, projected for 1997, and bases for calculation for each expense item.

IV- On分级管理预算

BASED ON THE SITUATION OF IMPLEMENTING THE STATE BUDGET IN 1995 AND 1996, THE ESTIMATED REVENUE OF THE STATE BUDGET ON THE TERRITORY, EXPENDITURE OF THE LOCAL STATE BUDGET IN 1997, AND THE PROJECTED REVENUE AND EXPENDITURE OF THE STATE BUDGET IN 1998 AND 1999, THE PEOPLE'S COMMITTEES OF PROVINCES AND CITIES DIRECTLY UNDER THE CENTRAL GOVERNMENT SHALL ESTABLISH AND ADVISE THE GOVERNMENT ON THE PERCENTAGE OF DIVISION BETWEEN THE NATIONAL TREASURY AND THE PROVINCIAL BUDGET AS PROVIDED FOR IN CLAUSE 2, ARTICLE 28 OF THE STATE BUDGET LAW, THE AMOUNT TO BE SUPPLEMENTED FROM THE NATIONAL TREASURY TO THE PROVINCIAL BUDGET TO STABILIZE FROM 1997 TO 1999. AT THE SAME TIME:

- BASED ON POINT 2, ARTICLE 31, POINT 2, ARTICLE 33, AND POINT 2, ARTICLE 35 OF THE STATE BUDGET LAW; BASED ON THE LEVEL OF MANAGEMENT OF INVESTMENT EXPENDITURE FOR CONSTRUCTION AND DEVELOPMENT OF THE LOCAL AUTHORITIES, THE REVENUE OF EACH LEVEL OF THE BUDGET, AND THE SPECIFIC CONDITIONS OF THEIR OWN LOCALITY, TEMPORARILY DEFINE THE DELEGATION OF EXPENDITURE FOR INVESTMENT IN THE CONSTRUCTION OF ECONOMIC AND SOCIAL INFRASTRUCTURE PROJECTS IN THE LOCALITY AS A BASIS FOR BUILDING THE 1997 BUDGET ESTIMATE TO BE SUBMITTED TO THE PEOPLE'S COUNCIL FOR DECISION ALONG WITH THE DECISION ON THE 1997 BUDGET ESTIMATE.

- GUIDE THE LOCAL AUTHORITIES ON THE PERCENTAGE OF DIVISION BETWEEN THE PROVINCIAL BUDGET AND THE BUDGET OF EACH DISTRICT, CITY, AND RURAL COMMUNE, AND THE BUDGET OF EACH WARD, VILLAGE, AND MARKET TOWN AS PROVIDED FOR IN CLAUSE 3, ARTICLE 30, CLAUSES 2 AND 3, ARTICLE 32, AND CLAUSE 2, ARTICLE 34 OF THE STATE BUDGET LAW; THE AMOUNT TO BE SUPPLEMENTED FROM THE UPPER BUDGET TO THE LOWER BUDGET TO SERVE AS A BASIS FOR THE LOCAL AUTHORITIES TO BUILD THE BUDGET ESTIMATE.

V- Implementation Organization:

1- 1997 IS THE FIRST YEAR OF IMPLEMENTATION OF THE STATE BUDGET LAW AND CALCULATION TO STABILIZE THE DELEGATION OF BUDGET MANAGEMENT FOR THE FOLLOWING YEARS, SO THE LOCAL AUTHORITIES DO NOT HAVE ENOUGH BASIS FOR THE DELEGATION OF BUDGET MANAGEMENT OF REVENUE SOURCES, EXPENDITURE TASKS, THE PERCENTAGE OF DIVISION OF REVENUE SOURCES, AND THE AMOUNT TO BE SUPPLEMENTED FROM THE UPPER BUDGET TO DECIDE THE BUDGET ESTIMATE OF THEIR OWN LEVEL BEFORE THE NATIONAL ASSEMBLY DECIDES THE STATE BUDGET ESTIMATE. THEREFORE, THE PEOPLE'S COMMITTEES AT ALL LEVELS SHALL BASE ON DIRECTIVE NUMBER 442/TTg DATED JULY 3, 1996 ISSUED BY THE PRIME MINISTER, THE GUIDANCE IN THIS CIRCULAR, AND THE GUIDANCE FROM SUPERIOR AUTHORITIES, BASED ON THE CHECKED REVENUE AND EXPENDITURE OF THE BUDGET, PREPARE THE BUDGET ESTIMATE OF THEIR OWN LEVEL TO SEND TO SUPERIOR AUTHORITIES FOR COMBINATION AND PREPARATION OF THE STATE BUDGET ESTIMATE; WHEN THE NATIONAL ASSEMBLY APPROVES THE STATE BUDGET ESTIMATE, THE GOVERNMENT WILL ASSIGN REVENUE AND EXPENDITURE OF THE BUDGET, THE PERCENTAGE OF DIVISION OF REVENUE SOURCES, AND THE AMOUNT TO BE SUPPLEMENTED TO LOCALITIES, THE PEOPLE'S COMMITTEES AT ALL LEVELS SHALL SUBMIT TO THE PEOPLE'S COUNCIL FOR DECISION ON THE BUDGET ESTIMATE AND BUDGET ALLOCATION OF THEIR OWN LEVEL IN LINE WITH THE PLAN ASSIGNED BY SUPERIOR AUTHORITIES.

DURING THE PROCESS OF BUILDING AND COMBINING THE ESTIMATE OF STATE BUDGET REVENUE, THE TAX AUTHORITIES AT ALL LEVELS, THE CUSTOMS BRANCHES OF PROVINCES, AND THE AUTHORITIES MANAGING STATE CAPITAL AND ASSETS IN ENTERPRISES MUST CLOSELY COOPERATE WITH THE AUTHORITIES BELONGING TO THE PEOPLE'S COMMITTEE TO BUILD THE ESTIMATE OF STATE BUDGET REVENUE ON THE TERRITORY ACCURATELY REFLECTING THE ACTUAL SITUATION OF THE LOCALITY. THE LOCAL TAX AUTHORITIES SHALL COOPERATE WITH THE FINANCE AUTHORITIES, THE AUTHORITIES MANAGING STATE CAPITAL AND ASSETS IN ENTERPRISES TO BUILD THE ESTIMATE OF STATE BUDGET REVENUE ON THE TERRITORY UNDER THEIR MANAGEMENT AND SEND IT TO THE SUPERIOR TAX AUTHORITIES, THE PEOPLE'S COMMITTEE, AND THE SAME-LEVEL FINANCE AUTHORITIES; THE CUSTOMS BRANCHES OF PROVINCES SHALL BUILD THE ESTIMATE OF EXPORT AND IMPORT TAXES UNDER THEIR MANAGEMENT AND OTHER REVENUES RELATED TO EXPORT AND IMPORT AND SEND IT TO THE GENERAL CUSTOMS DEPARTMENT, THE PROVINCE PEOPLE'S COMMITTEE, AND SIMULTANEOUSLY SEND IT TO THE DEPARTMENT OF FINANCE AND PRICE CONTROL.

THE AUTHORITIES MANAGING STATE CAPITAL AND ASSETS IN ENTERPRISES ACCORDING TO THE DELEGATION OF MANAGEMENT SHALL BUILD THE ESTIMATE OF REVENUE AND EXPENDITURE FOR EACH STATE ENTERPRISE ON THE TERRITORY, SUMMARIZE, AND REPORT TO THE SUPERIOR AUTHORITIES, THE PEOPLE'S COMMITTEE, AND THE SAME-LEVEL FINANCE AUTHORITIES.

2- THE TIMELINE FOR BUILDING AND COMBINING THE 1997 STATE BUDGET ESTIMATE:

- BY AUGUST 10, 1996, THE MINISTRIES AND LOCALITIES SHALL BUILD AND COMBINE THE ESTIMATE OF REVENUE AND EXPENDITURE OF THE STATE BUDGET UNDER THEIR MANAGEMENT AND SEND IT TO THE MINISTRY OF FINANCE FOR COMBINATION AND SUBMISSION TO THE GOVERNMENT.

- THE MINISTRY OF FINANCE WILL DISCUSS THE 1997 BUDGET ESTIMATE WITH THE MINISTRIES, LOCALITIES, AND LARGE STATE ENTERPRISES (ELECTRICITY, COAL, STEEL, OIL AND GAS, CEMENT, SHIPPING, CIVIL AVIATION, POST AND TELECOMMUNICATIONS, RUBBER, COFFEE, GRAIN, TEXTILES, PAPER, TOBACCO...) FROM AUGUST 10, 1996 TO SEPTEMBER 20, 1996. THE SPECIFIC SCHEDULE WILL BE ANNOUNCED BY THE MINISTRY OF FINANCE LATER.

- FROM SEPTEMBER 1995, THE MINISTRY OF FINANCE SHALL COMPILE AND COMPLETE THE 1997 STATE BUDGET ESTIMATE AND PROVIDE A DETAILED EXPLANATION OF THE REVENUE AND EXPENDITURE ESTIMATE OF EACH MINISTRY AND LOCALITY TO SUBMIT TO THE GOVERNMENT, THE COMMITTEES OF THE NATIONAL ASSEMBLY FOR SUBMISSION TO THE NATIONAL ASSEMBLY SESSION IX, PERIOD 10.

3- REGARDING THE REPORT FORMS FOR THE 1997 STATE BUDGET ESTIMATE:

THE MINISTRIES, THE ORGANIZATIONS EQUIVALENT TO MINISTRIES, AND OTHER ORGANIZATIONS BELONGING TO THE GOVERNMENT SHALL BUILD, COMBINE, AND PREPARE THE 1997 STATE BUDGET ESTIMATE ACCORDING TO THE REPORT FORM SYSTEM DEFINED IN ATTACHMENT 2; THE PEOPLE'S COMMITTEES OF PROVINCES AND CITIES DIRECTLY UNDER THE CENTRAL GOVERNMENT SHALL BUILD, COMBINE, AND PREPARE THE 1997 STATE BUDGET ESTIMATE ACCORDING TO THE REPORT FORM SYSTEM DEFINED IN ATTACHMENT 3 OF THIS CIRCULAR. FOR MINISTRIES AND LOCALITIES WITH SPECIAL EXPENDITURE ITEMS, THEY NEED TO PREPARE THE REPORT FORMS TO FIT THE SITUATION.

REQUIRE THE MINISTRIES AND LOCALITIES TO ENSURE THAT ALL NECESSARY CONTENTS ARE INCLUDED IN THE REPORT, ACCOMPANIED BY A DETAILED EXPLANATION OF THE BASIS FOR BUILDING THE ESTIMATE OF EACH REVENUE AND EXPENDITURE ITEM OF THE 1997 STATE BUDGET.

4- THE GENERAL TAX COLLECTOR, THE GENERAL INVESTMENT AND DEVELOPMENT, THE GENERAL STATE CAPITAL AND ASSET MANAGEMENT IN ENTERPRISES, AND THE CENTRAL TREASURY HAVE THE RESPONSIBILITY TO ISSUE DETAILED GUIDANCE ON THIS CIRCULAR FOR IMPLEMENTATION IN THEIR SYSTEMS AND TO BUILD, COMBINE THE ESTIMATE OF REVENUE AND EXPENDITURE OF THE STATE BUDGET IN THEIR RESPECTIVE FIELDS.

5- THE MINISTRIES AND LOCALITIES SHALL GUIDE THE SUBORDINATE UNITS TO MANAGE AND EVALUATE THE IMPLEMENTATION OF THE 1996 STATE BUDGET REVENUE AND EXPENDITURE AND TO BUILD THE 1997 STATE BUDGET ESTIMATE. DURING THE PROCESS OF BUILDING THE 1997 STATE BUDGET ESTIMATE, IF THERE ARE NEW POLICIES AND REGULATIONS, THE MINISTRY OF FINANCE WILL ISSUE ADDITIONAL GUIDANCE. WHEN IMPLEMENTING, IF THERE ARE DIFFICULTIES, THE MINISTRIES AND LOCALITIES ARE REQUESTED TO REPORT TO THE MINISTRY OF FINANCE FOR TIMELY HANDLING./.

                                                                                                 NGUYEN SINH HUNG

                                                                                                (Signed)