Circular No. 66/2016/TT-BTC guiding the implementation of Government Decree No. 12/2016/NĐ-CP dated February 19, 2016 on environmental protection fees for mineral extraction.

CIRCULAR

 GUIDELINES FOR IMPLEMENTING THE DECREE NO. 12/2016/ND-CP DATED 19/02/2016

OF THE GOVERNMENT ON ENVIRONMENTAL PROTECTION FEES FOR MINERAL EXTRACTION

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BASED ON THE FEE AND CHARGE ORDINANCE NO. 38/2001/PL-UBTVQH10 DATED AUGUST 28, 2001 OF THE STANDING COMMITTEE OF THE NATIONAL ASSEMBLYx;

BASED ON DECREE NO. 57/2002/NĐ-CP DATED JUNE 3, 2002 AND DECREE NO. 24/2006/NĐ-CP DATED MARCH 6, 2006 AMENDING AND COMPLEMENTING CERTAIN ARTICLES OF DECREE NO. 57/2002/NĐ-CP DATED JUNE 3, 2002 OF THE GOVERNMENT PROVIDING GUIDELINES FOR THE IMPLEMENTATION OF THE FEE AND CHARGE ORDINANCE;

Decree No. 12/2016/ND-CP DATED 19/02/2016 OF THE GOVERNMENT ON ENVIRONMENTAL PROTECTION FEES FOR MINERAL EXTRACTION;

Pursuant to Decree No. 215/2013/NĐ-CP dated December 23, 2013, promulgated by the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

At the proposal of the Director of the Department of Tax Policy, THE MINISTRY OF FINANCE GUIDES THE COLLECTION, SUBMISSION, MANAGEMENT AND USE OF ENVIRONMENTAL PROTECTION FEES FOR MINERAL EXTRACTION AS PROVIDED IN DECREE NO. 12/2016/ND-CP DATED 19/2/2016 OF THE GOVERNMENT AS FOLLOWS:

Article 1. Scope of Regulation and Applicability

1. THESE GUIDELINES GUIDE THE COLLECTION, SUBMISSION, MANAGEMENT AND USE OF ENVIRONMENTAL PROTECTION FEES FOR MINERAL EXTRACTION ACCORDING TO DECREE NO. 12/2016/NĐ-CP.

2. THE APPLICANTS ARE ORGANIZATIONS AND INDIVIDUALS ENGAGED IN MINERAL EXTRACTION; GOVERNMENT AUTHORITIES AND ORGANIZATIONS AND INDIVIDUALS INVOLVED IN THE MANAGEMENT AND COLLECTION OF ENVIRONMENTAL PROTECTION FEES FOR MINERAL EXTRACTION.

Article 2. METHODS OF CALCULATING THE FEE

1. The environmental protection fee payable for mineral extraction within a payment period shall be calculated using the following formula:

F = [(Q1 x f1) + (Q2 x f2)] x K

In which:             

- F IS THE AMOUNT OF ENVIRONMENTAL PROTECTION FEES TO BE PAID IN THE PERIOD;

5. In cases where additional types of minerals are obtained during extraction that are permitted by the competent state authorities, the fee payer must pay the environmental protection fee for raw mineral (Q2) at the collection rate of the permitted mineral type.³);

- Q2 IS THE QUANTITY OF RAW MINERAL ORE EXTRACTED IN THE PERIOD (TONNES OR CUBIC METERS);³);

1. Organizations and individuals engaged in mineral extraction must declare and pay the environmental protection fee to the direct tax authority managing the same location as the resource tax declaration.³;

- f2 IS THE RATE OF FEE CORRESPONDING TO EACH TYPE OF MINERAL ORE EXTRACTED (DONG/TONNE OR DONG/CUBIC METERS);³);

- K is the coefficient for calculating fees based on the method of extraction, including:

+ OPEN-PIT MINING (INCLUDING WATER-BASED MINING SUCH AS TITAN, RIVER SAND AND GRAVEL): K = 1.05;

+ UNDERGROUND MINING AND OTHER MINING METHODS (OIL, NATURAL GAS, NATURAL MINERAL WATER AND OTHER CASES): K = 1.

2. For the quantity of overburden and waste rock removed during coal mining, no fee will be charged until the end of 2017.

3. THE QUANTITY OF OVERBURDEN AND WASTE ROCK DISPOSED OF (Q1) IN THE PERIOD OF PAYING THE FEE IS DETERMINED BASED ON THE DOCUMENTS OF THE MINING PROJECT INVESTMENT AND CONSTRUCTION PROJECT APPROVED BY THE COMPETENT STATE AUTHORITY OR BASED ON THE ENVIRONMENTAL IMPACT ASSESSMENT REPORT AND RELATED DOCUMENTS APPROVED BY THE COMPETENT STATE AUTHORITY.

THE FEE TO BE PAID FOR THE QUANTITY OF OVERBURDEN AND WASTE ROCK GENERATED IN THE PERIOD OF PAYING THE FEE IS BASED ON THE VOLUME OF OVERBURDEN AND WASTE ROCK CALCULATED IN TERMS OF VOLUME (TONNES OR CUBIC METERS) OF RAW MINERAL ORE EXTRACTED IN THE PERIOD.³EXAMPLE: A MINING PROJECT FOR IRON ORE EXTRACTION IN BAC CAN HAS AN AVERAGE OVERBURDEN FACTOR OF 0.7 CUBIC METERS/TONNE OF ORE, 10,000 TONNES OF IRON ORE WERE EXTRACTED IN JUNE 2016, THEN THE FEE TO BE PAID FOR THE OVERBURDEN AND WASTE ROCK DISPOSED OF IN THIS MONTH IS AS FOLLOWS:

10,000 x 0.7 x 200 DONG/CUBIC METERS³= 1,400,000 DONG

IF THERE IS NO INFORMATION ABOUT THE QUANTITY OF OVERBURDEN AND WASTE ROCK GENERATED IN THE PROJECT INVESTMENT AND CONSTRUCTION DOCUMENTS, ENVIRONMENTAL IMPACT ASSESSMENT REPORTS AND RELATED DOCUMENTS, THE DECLARATION AND PAYMENT OF THE FEE SHALL BE BASED ON THE ACTUAL QUANTITY OF OVERBURDEN AND WASTE ROCK GENERATED IN THE PERIOD.³ 4. THE QUANTITY OF RAW MINERAL ORE EXTRACTED IN THE PERIOD (Q2) TO DETERMINE THE AMOUNT OF ENVIRONMENTAL PROTECTION FEES TO BE PAID IS THE ACTUAL QUANTITY OF RAW MINERAL ORE EXTRACTED IN THE PERIOD OF PAYING THE FEE, WITHOUT REGARD TO THE PURPOSE OF EXTRACTING (FOR SALE, EXCHANGE, INTERNAL USE, STORAGE FOR FUTURE PRODUCTION OR OTHER PURPOSES) AND THE MINING TECHNOLOGY (HANDWORK, MECHANIZED) OR REGION, AREA, MINING CONDITIONS (MOUNTAINOUS, MID-HILLS, PLAINS, DIFFICULT AND COMPLEX MINING CONDITIONS). IN CASE THE MINERAL ORE MUST BE SCREENED, SEPARATED, SORTED, ENRICHED BEFORE SALE, THE QUANTITY OF RAW MINERAL ORE EXTRACTED IN THE PERIOD IS DETERMINED BASED ON THE CONVERSION FROM THE QUANTITY OF FINISHED MINERAL PRODUCTS TO THE QUANTITY OF RAW MINERAL ORE ACCORDING TO THE RATIO DETERMINED BY THE PEOPLE'S COMMITTEE OF THE PROVINCE.

5. IN CASE ADDITIONAL TYPES OF MINERALS ARE OBTAINED DURING THE MINING PROCESS THAT ARE DIFFERENT FROM THE MINERALS PERMITTED, THE PERSON PAYING THE FEE MUST PAY THE ENVIRONMENTAL PROTECTION FEE FOR THE RAW MINERAL ORE (Q2) AT THE RATE OF COLLECTION OF THE TYPE OF MINERAL PERMITTED BY THE COMPETENT STATE AUTHORITY.

6. ENTERPRISES EXTRACTING GRANITE FOR SLAB AND CARVINGS MUST APPLY THE FEE COLLECTION RATE AS PROVIDED IN POINT 1, SECTION II OF THE FRAMEWORK OF FEE RATES ISSUED ACCOMPANYING DECREE NO. 12/2016/NĐ-CP. IN CASE ENTERPRISES EXTRACT GRANITE FOR OTHER PURPOSES, THEY MUST APPLY THE FEE COLLECTION RATE AS PROVIDED IN POINT 15, SECTION II OF THE FRAMEWORK OF FEE RATES ISSUED ACCOMPANYING DECREE NO. 12/2016/NĐ-CP.

ENTERPRISES EXTRACTING GRANITE MUST DECLARE AND PAY THE FEE IN ACCORDANCE WITH THE ABOVE REGULATIONS. LOCAL TAX AUTHORITIES SHALL COOPERATE WITH LOCAL NATURAL RESOURCES AND ENVIRONMENT AUTHORITIES TO CHECK THE COMPLIANCE WITH THE DECLARATION AND PAYMENT OF THE FEE.

7. IN CASE ORGANIZATIONS AND INDIVIDUALS EXTRACT STONE FOR CARVINGS IN LARGE BLOCKS, THEY MUST APPLY THE FEE COLLECTION RATE AS PROVIDED IN POINT 2, SECTION II OF THE FRAMEWORK OF FEE RATES ISSUED ACCOMPANYING DECREE NO. 12/2016/NĐ-CP.

8. IN CASE ORGANIZATIONS AND INDIVIDUALS EXTRACT MINERALS FOR COMMON BUILDING MATERIALS IN THE LAND USE RIGHTS OF HOUSEHOLDS AND INDIVIDUALS TO BUILD HOUSEHOLD AND INDIVIDUAL PROJECTS IN THAT AREA; IN CASE THE EXTRACTED STONE AND ROCK IS USED FOR LANDFILL, MILITARY SECURITY PROJECTS, NATURAL DISASTER PREVENTION, MITIGATION AND RELIEF PROJECTS, THEY ARE NOT REQUIRED TO PAY THE ENVIRONMENTAL PROTECTION FEE FOR MINERAL EXTRACTION.

. DECLARATION AND PAYMENT OF THE FEE

1. ORGANIZATIONS AND INDIVIDUALS EXTRACTING MINERALS MUST SUBMIT THE ENVIRONMENTAL PROTECTION FEE DECLARATION FORM TO THE DIRECTLY MANAGING TAX AUTHORITY WHERE THE DECLARATION AND PAYMENT OF MINERAL RESOURCES TAX IS MADE. IN CASE NO ENVIRONMENTAL PROTECTION FEE IS GENERATED IN THE MONTH, THE DECLARANT STILL NEEDS TO SUBMIT THE DECLARATION FORM TO THE TAX AUTHORITY. IN CASE ORGANIZATIONS COLLECTING AND AGGREGATING MINERALS SUBMIT ON BEHALF OF THE MINERALS EXTRACTORS, THOSE ORGANIZATIONS HAVE THE RESPONSIBILITY TO SUBMIT THE ENVIRONMENTAL PROTECTION FEE DECLARATION FORM TO THE TAX AUTHORITY MANAGING THE MINERAL PROCUREMENT SITE. THE DEADLINE FOR SUBMITTING THE ENVIRONMENTAL PROTECTION FEE DECLARATION FORM TO THE TAX AUTHORITY IS NO LATER THAN THE 20TH DAY OF THE FOLLOWING MONTH. THE DECLARANT MUST COMPLETE THE DECLARATION FORM ACCURATELY AND BE RESPONSIBLE FOR THE ACCURACY OF THE DECLARATION.

Article 3Declaration and payment of fees

1. Organizations and individuals exploiting minerals must submit declaration forms for environmental protection fees to the direct tax administration agency where they declare and pay resource taxes. In cases where no environmental protection fees arise from mineral exploitation in a month, the fee payer still must declare and submit the fee declaration form to the tax authority. If an organization collecting and consolidating minerals registers to pay on behalf of the exploiter, that organization is responsible for submitting the declaration form for environmental protection fees to the tax authority managing the mineral collection facility. The deadline for declaring environmental protection fees to the tax authority is no later than the twentieth day of the following month. The fee payer must complete the declaration form accurately according to the prescribed format and bear responsibility for the accuracy of the declaration.

2. Environmental protection fees for mineral exploitation shall be levied monthly and settled annually. The settlement of environmental protection fees for mineral exploitation includes annual settlement and settlement up to the time of cessation of mineral exploitation activities, cessation of mineral purchasing and collecting activities, cessation of business operations, or cessation of enterprise ownership conversion contracts or restructuring enterprises.

4. The place for declaring and paying environmental protection fees for crude oil, natural gas, and coal gas is the local tax office where the fee payer has its main administrative office.

5. The currency for paying environmental protection fees for mineral exploitation is the Vietnamese Dong.

5. The currency for paying environmental protection fees for mineral exploitation is the Vietnamese Dong.

6. In addition to the above provisions, the declaration, payment, and settlement of environmental protection fees for mineral exploitation shall be carried out in accordance with the Law on Tax Administration and its guiding documents.

Article 4. Cases eligible for reduced environmental protection fees for minerals extracted as by-products

1. The following cases are eligible for reduced environmental protection fees for the extraction of mineral by-products as prescribed in Clause 3, Article 3 of Decree No. 12/2016/NĐ-CP:

a) Mineral exploitation activities remaining at tailing sites of mines that have been officially closed;

b) Production and business activities of organizations and individuals not aimed at mineral exploitation but having functions, tasks, or registered business operations, during which they obtain minerals (for example, obtaining sand during river dredging or port construction; obtaining soil and rock during hydropower plant, transportation infrastructure, or shooting range construction).

Other cases not falling under points a) and b) of this clause shall not be eligible for reduced environmental protection fees for mineral by-products.

2. The calculation of environmental protection fees for the extraction of mineral by-products shall be carried out in accordance with the provisions of Article 2 of this Circular.

3. Amend Clause 3 Article 2 as follows:Article 5Management and utilization of environmental protection fees for mineral exploitation

1. Environmental protection fees for mineral exploitation, excluding crude oil and natural gas, are local government revenue, enjoying 100% to support environmental protection and investment in the environment at the locality where mineral exploitation takes place, in accordance with the Environmental Protection Law and the State Budget Law, as follows:

a) Prevention and limitation of adverse impacts on the environment at the locality where mineral exploitation occurs;

b) Remediation of environmental degradation and pollution caused by mineral exploitation activities;

c) Maintenance, protection, and restoration of the environmental landscape at the locality where mineral exploitation occurs.

2. Environmental protection fees for crude oil and natural gas are central government revenue, enjoying 100% to support environmental protection and investment in the environment as stipulated by the Environmental Protection Law and the State Budget Law.

3. The locality referred to in this Article is the actual site of mineral exploitation and areas affected by such activities within the jurisdiction of communes and districts.

Article 6Public disclosure submission construction costs; environmental protection of environmental protection fees for mineral exploitation

By no later than March 31 each year, the fee collection agency shall publicly disclose the quantity of minerals exploited, the quantity of excavated waste rock discharged, and the amount of environmental protection fees paid by enterprises for the previous year through local media such as local newspapers, local radio stations, local television stations, the electronic information website of the fee collection agency, and other appropriate methods so that the public can be informed.

Article 7Responsibilities of local authorities

1. Responsibilities of the Provincial People's Committee

a) Submit to the People's Council at the same level for the allocation and use of collected environmental protection fees for environmental protection work at the locality where mineral exploitation occurs.

b) Direct the Department of Natural Resources and Environment to coordinate with the local tax authority to submit to the Provincial People's Committee for issuance of a decision on the ratio of conversion from finished mineral products to raw mineral quantities as the basis for calculating environmental protection fees, in line with the actual situation of the locality.

c) Direct the Department of Information and Communications to coordinate with the tax authority to publicly disclose the collection and payment status of environmental protection fees for mineral exploitation in the locality.

2. Responsibilities of the local Tax Authority

a) Guide and urge organizations and individuals engaged in mineral exploitation to declare, report, and pay fees in accordance with regulations.

b) Inspect and audit the declaration, payment, and settlement of environmental protection fees for mineral exploitation. Determine the amount of environmental protection fees to be paid according to regulations in cases where the payer has not implemented or fully implemented accounting records, invoices, and ledgers.

c) Handle administrative violations related to environmental protection fees for mineral exploitation within their authority and in accordance with the law.

d) Retain and utilize data and documents provided by mineral exploitation facilities and other entities in accordance with regulations.

đ) Coordinate with local natural resources and environment management agencies to organize the collection of environmental protection fees for mineral exploitation in accordance with Decree No. 12/2016/NĐ-CP and the Law on Tax Administration.

_{Article 8. Implementation organization}

1. This Circular takes effect from June 13, 2016, and applies to declarations and payments starting from May 2016. This Circular replaces Circular No. 158/2011/TT-BTC dated November 16, 2011, issued by the Ministry of Finance to guide the implementation of Decree No. 74/2011/NĐ-CP dated May 28, 2011, of the Government on environmental protection fees for mineral exploitation.

2. During the implementation process, if there are any difficulties, it is requested that agencies, organizations, and individuals promptly report them to the Ministry of Finance for research and guidance./.