Guidance on determination of education services prices in Vietnam from October 15, 2019

“Education services charges” refer to all costs and funds that directly or indirectly support education and training activities, including salary costs, supply costs, administrative costs, depreciation, and amortization costs (investment accumulation), and other costs and funds. Education services prices shall be determined according to Article 10 of Circular 14/2019/TT-BGDDT of the Ministry of Education and Training of Vietnam, specifically as follows:

Illustration (source internet)

Education services prices are determined based on the following formula:

In which:

Salary costs:

- Salary costs include amounts payable to teachers, lecturers, administrative officers, and employees directly involved in the provision of education and training services, including salaries, wages and salary-related allowances, contributions of social insurance and health insurance, unemployment insurance, trade union fees and other costs that must be paid in accordance with current laws.

+ Labor norm: To be determined as prescribed in clause 1, Article 7 hereof;

+ Salary unit price is determined based on applicable law on salaries; wage cost is the cost to be paid to an employee under an employment contract or collective bargaining agreement.

- Based on actual conditions and requirements, the salary costs shall be determined based on the salary fund or the revenue source of the educational institution to ensure their effective operation and must be detailed in their internal expenditure regulations.

Supply costs are costs used for teaching, learning, practice, laboratories, scientific researches; and service provision, including Costs of stationery, devices, electricity, water, materials, fuels, and other costs which are determined based on the consumption of supplies and unit price of supplies:

- The consumption of supplies shall be determined on the basis of economic and technical norms as follows:

+ For products with existing economic and technical norms prescribed by competent authorities, these economic-technical norms shall apply.

+ For products that lack economic and technical norms prescribed by competent authorities, the Principals or Heads of institutions/agencies shall promulgate their own economic and technical norms and be responsible for applying those economic and technical norms in an accurate, saving, and efficient manner.

- Unit price of supplies is determined as follows:

+ Unit price of supplies used to calculate education services prices is a price inclusive of VAT and is determined in accordance with the standards, type, and quality of those supplies. In specific:

++ Regarding supplies priced by the State: use the prices stipulated by the State (+) reasonable circulation costs (if any);

++ Regarding outsourced supplies: If there are no sufficient documents and invoices as prescribed, use the lowest price, which is be calculated from information sources such as market prices provided by specialized organizations or quotations of manufacturers, prices of suppliers; If there are sufficient documents and invoices as prescribed, use the buying prices stated in the sales invoices; or successful bids, hammer prices, quoted prices (+) reasonable costs to deliver the supplies to the educational institution (if any);

++ Regarding supplies which are directly imported and put into use: use the cost price as prescribed by competent authorities (+) reasonable costs to deliver the supplies to the educational institution (if any);

++ Regarding homemade supplies: use the ex-warehouse prices (+) actual costs to deliver the supplies to the educational institution (if any);

++ Regarding third-party processed supplies: use the ex-warehouse prices (+) processing cost (+) reasonable costs to deliver the supplies to the educational institution (if any);

Administrative costs refer to costs for serving operation of departments and divisions of the administration in the educational institution, including:

- Enrollment costs:

- Costs of services provided by third parties to support the administration; expenses associated with purchase and use of technical materials, patents, etc. (not qualified as fixed assets), which are gradually recorded into administrative costs; rents of fixed assets; payments to contractors (if any);

- Other monetary expenses under general administration, in addition to the above-mentioned costs, such as: conferences, guest receptions, per diem, traveling costs, expenditures for female employees, researches and training, associations membership fees, and other reasonable costs;

Costs of depreciation or amortization of fixed assets means the costs of depreciation or amortization of houses, structures, machinery and equipment and other fixed assets used in the provision of education and training services calculated according to regulations of the Ministry of Finance and the roadmap to record the costs of depreciation or amortization of fixed assets to the education services prices shall be prescribed by competent authorities.

Other costs include business license taxes, land rents, and other fees and charges

More details can be found in Circular 14/2019/TT-BGDDT of the Ministry of Education and Training of Vietnam, effective from October 15, 2019.

Thu Ba

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