Circular No. 96/2006/TT-BTC guiding the level of collection, system of collection, payment, management, and use of auction fees.

CIRCULAR

Guidelines on the level of collection, collection regime, payment, management, and use of auction fees

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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;

Pursuant to Decree No. 24/2006/NĐ-CP dated March 6, 2006 of the Government amending and supplementing certain 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. 05/2005/NĐ-CP dated January 18, 2005 of the Government on the sale of assets by auction;

Pursuant to Decision No. 216/2005/QĐ-TTg dated August 31, 2005 of the Prime Minister on the issuance of regulations on land use rights auction for land allocation with land use fee payment or land lease;

Pursuant to Directive No. 18/2006/CT-TTg dated May 15, 2006 of the Prime Minister on strengthening the implementation of Decree No. 05/2005/NĐ-CP dated January 18, 2005 of the Government on the sale of assets by auction;

The Ministry of Finance issues guidelines on the level of collection, collection regime, payment, management, and use of auction fees as follows:

I. SCOPE OF APPLICATION

1. Auction fees guided in this Circular apply to the sale of assets by auction as prescribed in Decree No. 05/2005/NĐ-CP dated January 18, 2005 of the Government on the sale of assets by auction (hereinafter referred to as Decree No. 05/2005/NĐ-CP) and the auction of land use rights for land allocation with land use fee payment or land lease as prescribed in Decision No. 216/2005/QĐ-TTg dated August 31, 2005 of the Prime Minister on the issuance of regulations on land use rights auction for land allocation with land use fee payment or land lease (hereinafter referred to as Decision No. 216/2005/QĐ-TTg).

2. The subjects liable to pay auction fees are the owners of the assets sold by auction (owners of the assets or persons authorized by the owners to sell the assets or individuals or organizations having the right to sell other people's assets under the law) and participants in the auction.

3. Units entitled to collect auction fees as prescribed in this Circular include enterprises selling assets by auction, public service units with the function of selling assets by auction, and asset auction committees (collectively referred to as fee collection units).

II. LEVEL OF AUCTION FEES COLLECTION

1. Level of auction fees collection applicable at fee collection units under central agencies

a) For the sale of assets by auction as prescribed in Decree No. 05/2005/NĐ-CP

a.1. Level of auction fees collection for the owner of the assets sold by auction

- In case the auctioned asset is sold successfully, the level of fees collected shall be calculated based on the value of the sold asset as follows:

- In case the auction of the asset is not successful, the owner of the asset sold by auction shall pay the auction enterprise the costs as stipulated in Clause 2, Article 26 of Decree No. 05/2005/NĐ-CP dated January 18, 2005 of the Government on the sale of assets by auction.

a.2. Level of auction fees collection for participants in the auction

- The level of auction fees collection for participants in the auction shall be determined corresponding to the starting price of the asset sold by auction as follows:

- In case the auction of the asset is not organized, the participant in the auction of the asset shall be refunded the full amount of the auction fees paid by the participant in the auction of the asset.

b) For the sale of land use rights by auction for land allocation with land use fee payment or land lease as prescribed in Decision No. 216/2005/QĐ-TTg

The level of auction fees collection for participants in the auction shall be determined corresponding to the starting price of the land use rights or the area of land sold by auction as follows:

b.1. In case of the auction of land use rights for residential construction of households and individuals as prescribed in Point a, Clause 1, Article 3 of the Auction Regulations for Land Allocation with Land Use Fee Payment or Land Lease issued together with Decision No. 216/2005/QĐ-TTg

b.2. In case of the auction of land use rights other than those prescribed in Point a, Clause 1, Article 3 of the Auction Regulations for Land Allocation with Land Use Fee Payment or Land Lease issued together with Decision No. 216/2005/QĐ-TTg

2. Level of auction fees collection applicable at fee collection units under local agencies

Depending on the specific characteristics and conditions of the locality, the People's Council of the province or centrally-administered city shall decide specifically on the level of auction fees collection applicable to each type of fee payer, each level of the value of the sold asset, each level of the starting price of the auctioned asset, land use rights, or the area of land sold by auction, but it shall not exceed the level of collection prescribed in Clause 1, this item.

3. The level of auction fees collection prescribed in Clause 1 and Clause 2, this item shall be uniformly applied to both fees included in the state budget and fees not included in the state budget. In case the fees are not included in the state budget, the fee rate (uniformly applied) already includes VAT according to the Law on Value Added Tax and guiding documents for its implementation.

III. REGIME OF COLLECTION, PAYMENT, MANAGEMENT, AND USE OF AUCTION FEES

1. Collection and payment of auction fees

a) When registering to participate in the auction, the participant in the auction must pay the auction fees as prescribed.

b) For the owner of the asset sold by auction, the payment of auction fees shall be made when receiving payment for the sale of the asset.

c) When collecting fees, the fee collection unit must issue and hand over the receipt to the fee payer as follows:

- For fee collection units that are enterprises selling assets by auction, they must issue and hand over invoices to the fee payer in accordance with the current regulations of the Ministry of Finance on the issuance, management, and use of invoices.

- For units collecting fees that are public service units with the function of auctioning assets or auction committees, they shall establish and issue receipts for fee payments to the payers according to the current regulations of the Ministry of Finance on the issuance, management, and use of tax stamps.

2. Management and use of auction fees

Auction fees are revenues aimed at covering costs for organizing auctions and collecting fees (such as listing fees, public announcement fees for auctions, registration fees for purchasing auctioned assets, bidding participation fees, display and viewing fees, auction session organization fees, asset delivery fees, etc.). The management and use of funds from auction fees shall be carried out as follows:

a) For units collecting fees that are public service units with the function of auctioning assets or auction committees: Auction fees collected are revenues belonging to the state budget, which shall be managed and used as follows:

- In cases where the fee-collecting unit has been guaranteed funding by the state budget for organizing auctions, the fee-collecting unit must deposit the entire amount of collected fees into the state budget according to the corresponding chapters, types, clauses, sections, and sub-sections of the current State Budget Classification.

- In cases where the fee-collecting unit has not been guaranteed funding by the state budget for organizing auctions, the fee-collecting unit may use the entire amount (100%) of collected fees to cover costs for organizing auctions and collecting fees according to the prescribed regulations.

Based on the level of auction fees applied locally and the operational situation of public service units with the function of auctioning assets or auction committees within their jurisdiction, the People's Councils of provinces and centrally-administered cities shall decide the percentage to retain from the collected auction fees for the fee-collecting units to cover costs for organizing auctions and collecting fees.

b) For units collecting fees that are enterprises auctioning assets: Auction fees collected are revenues not belonging to the state budget. The collected fees are the revenue of the fee-collecting unit. The fee-collecting unit has the obligation to pay taxes on the collected fees according to the laws and has the right to manage and use the collected fees after paying taxes according to the laws. Annually, the fee-collecting unit must settle taxes on the collected fees with the tax authority according to the current tax laws.

c) In cases of auctioning land use rights for transferring land with land use fees or leasing land according to Decision No. 216/2005/QĐ-TTg, if the auction fees collected from participants in the auction are insufficient to cover the costs for organizing the auction, the state budget shall support the remaining funding for organizing the auction according to the following principle:

- The value of the land use rights being auctioned is a revenue belonging to which level of budget (irrespective of whether the auction is successful or not), that level of budget shall be responsible for ensuring the funding support;

- The amount of support is the difference between the actual and reasonable costs for the auction (with valid invoices and supporting documents) minus the auction fees collected from participants, but not exceeding the auction fees calculated according to point a.1, clause 1, section II of this Circular.

IV. IMPLEMENTATION

1. This Circular takes effect fifteen days after its publication in the Official Gazette.

2. Other contents related to the collection, payment, management, use, and public disclosure of non-tax fees not specified in this Circular shall be implemented according to the guidance provided in Circular No. 63/2002/TT-BTC dated July 24, 2002, issued by the Ministry of Finance guiding the implementation of laws on fees and charges, and Circular No. 45/2006/TT-BTC dated May 25, 2006, issued by the Ministry of Finance amending and supplementing Circular No. 63/2002/TT-BTC.

3. For localities that have issued fee collection regulations that are inconsistent with the provisions of this Circular, the People's Committees of provinces and centrally-administered cities shall submit to the People's Councils of the same level to promulgate new regulations in accordance with this Circular.

4. During the implementation period, if there are any difficulties, organizations and individuals are requested to promptly report them to the Ministry of Finance for research and supplementary guidance.