CIRCULAR

AMENDING AND SUPPLEMENTING THE FINANCE MINISTRYS CIRCULAR No. 119/2005/TT-BTC OF DECEMBER 22, 2005, WHICH GUIDES FINANCIAL REGULATIONS APPLICABLE TO DUNG QUAT ECONOMIC ZONE

Pursuant to the Prime Ministers Decision No. 50/2005/QD-TTg of March 11, 2005, establishing, and promulgating the Operation Regulation of, Dung Quat Economic Zone, Quang Ngai province;
Pursuant to the Prime Ministers Decision No. 72/2005/QD-TTg of April 5, 2005, establishing, and defining the functions, tasks, powers and organizational structure of, the Dung Quat Economic Zone Management Board;
Pursuant to the Prime Ministers Decision No. 396/QD-TTg of April 5, 2007, transferring the Dung Quat Economic Zone Management Board under the Prime Ministers management to the Peoples Committee of Quang Ngai province for management;

The Ministry of Finance guides amendments and supplements to a number of contents of the Finance Ministrys Circular No. 119/2005/TT-BTC of December 22, 2005, as follows:

1. Point 1.2.3(b), Part II, guiding income tax on high-income foreigners, is amended as follows:

b/ For foreigners:

- For nonresidents, the payable tax amount is determined as follows:

Payable personal income tax amount = Total taxable income multiplied by (x) 25% and multiplied by (x) 50%.

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2. Clause 4, Part II, guiding incentives for infrastructure development, is amended and supplemented as follows:

2.1. Point 4.1(b) of Clause 4 is amended as follows:

b/ With in the first 15 years after the effective date of Decision No. 50/2005/QD-TTg, the annual state budget-invested capital for Dung Quat Economic Zones infrastructure construction shall not be lower than Dung Quat Economic Zones total state budget revenues remitted into the State Treasury, including revenues from import tax, export tax, special consumption tax on imports, enterprise income tax, and income tax on high-income earners (except value-added tax on imports), and other lawful revenues. Import tax, export tax and special consumption tax on imports shall be calculated only on the actually imported and exported goods for which declarations are made at the bonded areas customs office and taxes have been paid at the State Treasury in Quang Ngai province.

2.2. To add the following Point 4.1(d), Clause 4:

d/ Annually, based on socio-economic infrastructure investment projects already approved by competent authorities and their execution progress, the central budget shall provide targeted additional allocations to Quang Ngai provinces budget for investment in Dung Quat Economic Zones infrastructure works in accordance with the State Budget Law.

The central budgets targeted support capital to Quang Ngai provinces budget for investment in Dung Quat Economic Zones socio-economic infrastructure works as well as public service and utility works must be clearly indicated in state budget estimates allocated to Quang Ngai province. Annually, Quang Ngai province shall allocate local budget estimates together with the central budgets support capital for investment in Dung Quat Economic Zones socio-economic infrastructure as well as public service and utility works under the provisions of Point 4.1 of this Clause.

2.3. Point 4.2 of Clause 4 is amended as follows:

4.2. The central budget capital invested in the construction of Dung Quat Economic Zones infrastructure shall be managed and used according to regulations on capital construction investment management, the State Budget Law and current guiding documents: Annually, at the time of state budget estimation, the Dung Quat Economic Zone Management Board shall coordinate with concerned agencies in determining revenues from import tax, export tax, special consumption tax on imports, enterprise income tax, income tax on high-income earners and value-added tax, and other lawful revenues in Dung Quat Economic Zone in order to estimate annual capital construction investment expenditures according to the list of investment projects approved by a competent authority, and submit them to the Peoples Committee of Quang Ngai province for submission to the Ministry of Planning and Investment and the Ministry of Finance for synthesis and report to the Government for further submission to the National Assembly for decision.

2.4. Point 4.3 of Clause 4 is amended as follows:

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The Dung Quat Economic Zone Management Board, which acts as a coordinator to be assigned annual plan targets and an investor to directly manage projects funded with capital generated from the land fund in Dung Quat Economic Zone, shall organize bidding to select financially capable, experienced and prestigious units to execute infrastructure projects invested with capital generated from the land fund in Dung Quat Economic Zone.

The Dung Quat Economic Zone Management Board shall make a list of infrastructure construction investment projects using the land fund to generate capital, stating the area of the land zone used to generate capital for these projects, and send it to Quang Ngai provinces Finance Service and Planning and Investment Service for synthesis according to the State Budget Law for the Peoples Committee to submit it to the Peoples Council for decision according to its competence.

Based on the localitys land use planning, possible land use levies, land rents through auction, land use levies and land rents not through auction, as well as required expenditures for compensations or support to persons having land recovered and for infrastructure works invested with the state budget according to law, the Peoples Committee of Quang Ngai province shall direct the finance agency to include these revenues and expenditures in annual state budget estimates for submission to the provincial Peoples Council for decision.

Based on annual state budget estimates decided by the provincial Peoples Council, the provincial Peoples Committee shall assign the finance agency to coordinate with concerned units in making revenues or expenditures from land use levies and land rents and finalize them into the state budget according to regulations.

In case organizations or individuals advance funds for paying compensations or providing support to persons having land recovered in order to execute state budget-invested infrastructure works, then conduct auction for collecting land use levies and land rents, the land use levy and land rent amounts used for refund to these organizations or individuals must be accounted fully into the state budget according to current provisions of law.

The use of the land fund to generate capital for Dung Quat Economic Zones infrastructure construction complies with the Governments Decree No. 181/2004/ND-CP of October 29, 200)4, on the implementation of the Land Law, Decree No. 17/2006/ND-CP of January 27, 2006, amending and supplementing a number of articles of the Decrees guiding the implementation of the Land Law, the Prime Ministers Decision No. 216/2005/QD-TTg of August 31, 2005, promulgating the Regulation on auction of land use rights for land allotment with collection of land use levies or for land lease, and current relevant provisions of law.

2.5. Point 4.4 of Clause 4 is amended as follows:

4.4. Capital raising by issuing government bonds or project bonds, and official assistance development (ODA) capital for investment in Dung Quat Economic Zones infrastructure development

The issuance of government bonds or project bonds for investment in Dung Quat Economic Zones infrastructure development complies with the Governments Decree No. 141/2003/ND-CP of November 20, 2003, promulgating the Regulation on issuance of government bonds, government-guaranteed bonds and local administrations bonds, and other forms of capital raising according to law.

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3. Point 5, Part II, guiding financial regulations applicable to the Dung Quat Economic Zone Management Board, is amended as follows:

5. Financial regulations applicable to the Dung Quat Economic Zone Management Board:

5.1. The Dung Quat Economic Zone Management Board is a local budget-estimating unit and a coordinator in planning development investment capital to be allocated from Quang Ngai provinces budget under annual plans. Particularly, during the period of local budget stabilization up to the end of 2010, the Dung Quat Economic Zone Management Boards administrative and non-business funds shall be covered with the central budget. The Dung Quat Economic Zone Management Board may decide on budget revenues and expenditures in the domains of development investment, administrative and non-business affairs, and target programs, and other domains in accordance with law. All lawful revenues collected by the Dung Quat Economic Zone Management Board must be remitted into the state budget.

5.2. The Dung Quat Economic Zone Management Board may, based on its tasks authorized by state management agencies, collect charges and fees according to current regulations. When authorized by competent state agencies to collect charges and fees, the Dung Quat Economic Zone Management Board shall notify to and register with the tax office of the locality where it is headquartered for carrying out procedures for remitting the charge and fee amounts collected from the performance of their authorized tasks.

4. This Circular takes effect 15 days after its publication in CONG BAO. The Dung Quat Economic Zone Management Board and other concerned agencies in Dung Quat Economic Zone shall enhance their coordination in implementing the provisions of Circular No. 119/2005/TT-BTC and this Circular. Problems arising in the course of implementation should be reported to the Ministry of Finance for study and settlement.

FOR THE MINISTER OF FINANCE
VICE MINISTER




Nguyen Cong Nghiep