Method for Determining the Estimated Production Cost of Rice

The Circular 77 stipulates that the Ministry of Finance, based on the actual production cost of rice in each province and city during the same season of the previous year and the projected Consumer Price Index (CPI) for the entire country for the planned year as published by the National Assembly, shall determine and announce the projected average rice production cost for the entire production region at the beginning of each production season. To be specific:

- Determine the projected production cost of rice for each province according to the formula:

Zdk(i,k) = Ztt(i-1,k) x (1 + CPIdk(i))

In which:

- Zdk(i,k) is the projected production cost of rice in year i, season k (VND/kg);- Ztt(i-1,k) is the actual production cost of rice in the same season of the previous year (VND/kg);- CPIdk(i) is the projected CPI for the entire country in year i as published by the National Assembly.

Additionally, Circular 77 also stipulates the determination of the projected average production cost of rice for the entire production region according to the formula:

Zbqdk(i,k) = Zbqtt(i-1,k) x (1 + CPIdk(i))

In which:

- Zbqdk(i,k) is the projected average production cost of rice in year i, season k (VND/kg);- Zbqtt(i-1,k) is the actual average production cost of rice in the same season of the previous year for the entire production region, calculated by dividing the total actual production cost of rice in the provinces within the production region by the total number of provinces conducting investigation and survey (VND/kg);- CPIdk(i) is the projected CPI for the entire country in year i as published by the National Assembly.

For further details, see Circular 77/2018/TT-BTC, effective from October 1, 2018.

- Thao Uyen -

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