Circular No. 94/1999/TT-BTC guides the use of revenue from agricultural land use tax, water conservancy fees, and other sources to implement the reinforcement of irrigation canals.

CIRCULAR

DIRECTIVE NO. 94/1999/TT-BTC OF THE MINISTRY OF FINANCE ON JULY 31, 1999 GUIDING THE USE OF REVENUES FROM LAND USE TAX AND WATER MANAGEMENT FEES AND OTHER SOURCES FOR STRENGTHENING CANALS AND DITCHES
AGRICULTURAL AND WATER MANAGEMENT FEES AND OTHER SOURCES
TO IMPLEMENT THE STRENGTHENING OF CANALS AND DITCHES

- Pursuant to Resolution No. 18/1998/QH 10 of the National Assembly of the Socialist Republic of Vietnam, tenth session, fourth meeting, on the state budget for 1999.

- Pursuant to Resolution No. 08/1999/NQ-CP dated July 9, 1999 of the Government on solutions to manage and implement economic and social tasks in the last six months of 1999;

The Ministry of Finance guides the use of revenues from land use tax, water management fees, and other sources for implementing the strengthening of canals and ditches as follows:

1/ Sources for implementing the strengthening of canals and ditches include:

- Land use tax for agricultural land: According to the current mechanism, 100% of this revenue is retained for investment in agriculture and rural development. Therefore, provinces must concentrate all of these revenues on the goal of developing agriculture and rural areas, allocating at least 40% for the goal of strengthening canals and ditches to be completed within two to three years. For localities with low land use tax revenue for agricultural land or difficulties in strengthening canals and ditches, the proportion of land use tax allocated for the goal of strengthening canals and ditches may be higher or lower than the above regulation.

- Water management fees:

+ For localities (mainly in the southern delta) where water management fees are contributions paid into the state budget for water resource development, they are used like land use tax for the purpose of strengthening canals and ditches.

+ For localities where water management fees managed by water management companies (referred to as water management enterprises) are used to cover production and business costs: salaries and allowances for staff; electricity and fuel expenses for irrigation and maintenance of canal systems. Localities need to direct relevant sectors to improve the management of these companies to ensure sufficient collection of water management fees, promptly settle outstanding debts, and allocate funds proactively for the repair of canals towards strengthening them.

- Contributions from the people to strengthen canals and ditches, especially inter-village and intra-field canals.

- Preferential credit investment capital: In cases where local budgets face difficulties, the State will allocate preferential credit capital for provincial budgets to borrow to accelerate the implementation of canal strengthening; Provincial budgets need to proactively arrange repayment of principal from land use tax revenue and other sources (the central government subsidizes interest on loans).

- Other sources: direct aid, economic development funds (if available), ...

All of the above sources must be included in the local budget revenue and expenditure plan; Specifically, for land use tax revenue for agricultural land, the management and use of this revenue must ensure its intended purpose.

2/ Contents of expenditures for implementing the strengthening of canals and ditches

All revenues as stipulated in Point 1 of this Circular shall be used for the following purposes:

- Investment in building new canals and ditches according to the direction of strengthening.

- Strengthening existing canals and ditches, including the strengthening of water retention dams, water regulating gates, embankments, or irrigation pipeline systems suitable for each region's conditions as guided by the Ministry of Agriculture and Rural Development.

- Providing materials (cement, iron, steel, ...) to communes to strengthen inter-village and intra-field canals, while the people contribute labor days.

- Other expenditures serving the canal strengthening program.

3/ Management work

- To effectively implement the policy of strengthening canals and ditches, localities need to direct the Department of Agriculture and Rural Development to coordinate with related sectors to immediately conduct surveys and investigations of the current status of canal systems; Investment needs for new canals, thereby formulating overall plans and investment projects to be submitted to the People's Committee of the province for decision. The selection and decision on investment plans should first focus on key areas to achieve high irrigation capacity with low costs.

- Allocation of investment tasks:

The allocation of investment tasks for basic construction projects is carried out according to the general allocation level of the province and may be allocated as follows:

+ For inter-district and inter-commune projects: the province directly invests, including water management projects managed by water management companies.

+ For intra-field and inter-village projects: allocated to commune level.

- Management work: Implemented according to the provisions of the State Budget Law and current financial management regulations of the State. Among which, attention should be paid to some contents:

+ Preparation of budget estimates: Based on the overall plan and allowable capital, the province decides specific projects and investment levels annually according to current regulations. For intra-field water management projects implemented by communes when preparing projects, it is necessary to clearly define the amount of state support and mobilization at the commune level (including labor days). For the year 1999, it is necessary to review the land use tax revenue already allocated to adjust and allocate approximately 50% - 60% of the remaining capital for canal strengthening. For some provinces with special conditions as stipulated in Point 1 of this Circular, the proportion may be higher or lower than the general regulation.

+ Implementation of budget estimates: To effectively implement the policy of canal strengthening within two to three years, the province needs to assign the Department of Agriculture and Rural Development to coordinate with relevant agencies to assist the People's Committee of the province in directing and timely implementation plans. The Financial Department (Department of Finance and Prices, Investment and Development Bureau) has the responsibility to monitor and ensure timely disbursement of funds for projects according to current regulations.

Settlement: The settlement of budget expenditures and the settlement of construction projects shall be carried out in accordance with current regulations. Each quarter and at the end of the year, localities shall report on the situation of capital allocation and the results of canal and irrigation channel consolidation to the Ministry of Finance (Investment General Department, State Budget Department). Among other things, there should be an analysis and evaluation of key economic indicators achieved, such as: kilometers of canals and irrigation channels, kilometers of embankments, number of water regulating culverts, kilometers of piped water supply and irrigation systems consolidated, irrigable land area supplied with production and flood drainage water, effectiveness of canal and irrigation channel consolidation,...

This Circular takes effect fifteen days from the date of signature.

We request the People's Committees of provinces and centrally governed cities to organize and direct relevant agencies and units to implement this. Any difficulties encountered during implementation should be promptly reported to the Ministry of Finance for consideration and resolution.