What are cases of resource royalty distribution in Vietnam?

What are cases of resource royalty distribution in Vietnam?

Based on Article 15 of Circular 80/2021/TT-BTC stipulates as follows:

Declaration, calculation, distribution, and payment of resource royalty

1. Cases for distribution:

Hydropower production activities with hydropower reservoirs located across multiple provinces.

2. distribution method:

a) Basis for distributing the payable resource royalty to each province:

a.1) The area of the hydropower reservoir is t, the area of the hydropower reservoir in Province G is t.1, and the area of the hydropower reservoir in Province H is t.2.

The percentage (%), area of the reservoir in Province G is T.1 = t.1/t x 100.

The percentage (%), area of the reservoir in Province H is T.2 = t.2/t x 100.

a.2) The cost of compensation for land clearance, resettlement is k; the cost of compensation for land clearance, resettlement in Province G is k.1; the cost of compensation for land clearance, resettlement in Province H is k.2.

The percentage (%), compensation cost for land clearance, resettlement in Province G is K.1 = k.1/k x 100.

The percentage (%), compensation cost for land clearance, resettlement in Province H is K.2 = k.2/k x 100.

a.3) The number of households to be resettled is s, the number of households to be resettled in Province G is s.1, and the number of households to be resettled in Province H is s.2.

The percentage (%), number of households to be resettled in Province G is S.1 = s.1/s x 100.

The percentage (%), number of households to be resettled in Province H is S.2 = s.2/s x 100.

a.4) The value of compensation for material damage in the reservoir area is v, the value of compensation for material damage in the reservoir area in Province G is v.1, and the value of compensation for material damage in the reservoir area in Province H is v.2.

The percentage (%), value of compensation for material damage in the reservoir area in Province G is V.1 = v.1/v x 100.

The percentage (%), value of compensation for material damage in the reservoir area in Province H is V.2 = v.2/v x 100.

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Distribution of resource royalty in the case of hydropower production activities with hydropower reservoirs located across multiple provinces.

What are cases of resource royalty distribution in Vietnam? (Image from the Internet)

How to determine natural resource production for calculating royalty payable in Vietnam?

According to Article 5 of the Law on severance tax 2009, the method of calculating resource royalty according to production is as follows:

- For resources extracted where the quantity, weight, or volume can be identified, the production of natural resources for calculating royalty payable is the actual quantity, weight, or volume of resources extracted during the calculating royalty payable period.

- For resources extracted where the actual quantity, weight, or volume cannot be identified due to the presence of various substances or impurities, the production of natural resources for calculating royalty payable is determined based on the quantity, weight, or volume of each substance obtained after sorting and classification.

- For resources extracted but not sold and instead used to produce other products, if the actual quantity, weight, or volume cannot be directly determined, the production of natural resources for calculating royalty payable is determined based on the production of products during the calculating royalty payable period and the resource use norm per unit of product.

- For natural water used for hydropower production, the production of natural resources for calculating royalty payable is the electricity output of the hydropower production unit sold to the electricity purchaser as per the purchase contract or the delivered electricity output in the case where there is no purchase contract, as determined by the standard measurement system of Vietnam, confirmed by the purchaser, seller, or delivering and receiving entities.

- For natural mineral water, natural hot water, and natural water used for industrial purposes, the production of natural resources for calculating royalty payable is determined in cubic meters (m³) or liters (l) according to the standard measurement system of Vietnam.

- For resources extracted manually, scattered or mobile extraction, not frequently, and the expected extraction production value in one year is below 200,000,000 VND, the estimated production is determined seasonally or periodically for calculating royalty payable. The tax office collaborates with relevant local authorities to determine the estimated production for tax purposes.

Who are the severance taxpayers in Vietnam?

Based on Article 3 of the Law on severance tax 2009 (amended by Clause 2, Article 67 of the Petroleum Law 2022) stipulates as follows:

Taxpayers

1. Severance taxpayers are organizations and individuals who exploit resources that are subject to resource royalty, except for the exploitation of resources from mines, clusters of mines, oil fields subject to the regulations of the law on petroleum.

2. Severance taxpayers in some specific cases are as follows:

a) Enterprises exploiting natural resources established on a joint venture basis, the joint venture enterprise is the taxpayer;

b) In business cooperation contracts for resource exploitation involving Vietnamese and foreign parties, the tax responsibility of the parties must be specifically determined in the business cooperation contract;

c) Organizations and individuals who exploit small-scale resources sold to organizations and individuals that act as purchasing agents, with a written commitment from the purchasing agents to declare and pay tax on behalf of the exploiting organizations and individuals, then the purchasing agents are the taxpayers.

Severance taxpayers are organizations and individuals who exploit resources that are subject to resource royalty, except for the exploitation of resources from mines, clusters of mines, oil fields subject to the regulations of the law on petroleum.