THE MINISTRY OF FINANCE
SOCIALIST REPUBLIC OF VIET NAM
Independence - Freedom - Happiness
Hanoi, April 29, 2003
GUIDING THE FINANCIAL MECHANISM APPLICABLE TO ENTERPRISES OF PUBLIC PASSENGER TRANSPORTATION BY BUSES IN URBAN CENTERS
Pursuant to the current tax laws;
Pursuant to the Government's Resolution No.13/2002/NQ-CP of November 19, 2002 on measures to check the rise in and proceed to gradually reduce traffic accidents and congestion;
Pursuant to the Government's Decree No.56/CP of October 2, 1996 on State enterprises engaged in public-utility activities;
In order to encourage and create conditions for enterprises operating in the field of public passenger transportation by buses in urban centers, the Finance Ministry hereby provides guidance as follows:
I. GENERAL PROVISIONS
1. Subject to the application of this Circular are enterprises of all economic sectors, which are engaged in public passenger transportation by buses in urban centers, including:
- State enterprises, including:
+ State enterprises engaged in public-utility activities of public passenger transportation by buses.
+ State enterprises' sections engaged in public-utility activities of public passenger transportation by buses.
+ State enterprises engaged in business activities and participating in public passenger transportation by buses.
- Enterprises of other types participating in public passenger transportation by buses such as transport cooperatives, joint-venture companies, limited liability companies, joint-stock companies....
2. State enterprises and public-utility State enterprises engaged in public passenger transportation by buses shall comply with the provisions in Circular No.06/TC-TCDN of December 24, 1997 of the Finance Ministry guiding the financial management regime for public-utility State enterprises and the provisions in this Circular.
3. Passenger bus transportation enterprises which organize other production and business activities shall have to account separately revenues, expenditures, business results and fulfill the State budget remittance obligations as prescribed.
4. Enterprises engaged in public passenger transportation by buses are entitled to enjoy policies of preferences on land rent, land road and bridge tolls, stop and parking yard fees under the current regulations and decisions of competent agencies.
II. SPECIFIC PROVISIONS
A. INVESTMENT, MANAGEMENT AND USE OF CAPITAL, ASSETS
1. State enterprises tasked to conduct public-utility activities of public passenger transportation in urban centers shall have to open books and record accounting books to accurately monitor all available assets and capital according to the current book-keeping accounting and statistical regimes for the performance of the task of public passenger transportation by buses.
For State enterprises which have sections engaged in public-utility activities of public passenger transportation by buses, those sections must organize separate accounting.
2. State enterprises and enterprises of other economic sectors, which invest their own assets for participation in activities of public passenger transportation by buses in urban centers shall be entitled to enjoy investment preferences under the (amended) Domestic Investment Promotion Law No.03/1998/QH10 and be given post-investment interest rate support under the guidance in the Finance Ministry's Circular No.51/2001/TT-BTC of June 28, 2001 guiding the implementation of the Prime Minister's Decision No.58/2001/QD-TTg of April 24, 2001 on post-investment interest rate support (if enterprises borrow capital for investment).
B. FINANCIAL RESULTS AND HANDLING OF FINANCIAL RESULTS
1. Turnover from public-utility activities of public passenger transportation by buses in urban centers:
1.1. For public-utility State enterprises or public-utility sections of State enterprises, their turnover shall include:
- Turnover from sale of bus tickets (single trip tickets, route ticket, inter-route tickets).
- The States price subsidy.
1.2. For enterprises of other economic sectors, their turnover shall include:
- Turnover from sale of bus tickets (single trip tickets, route tickets).
- Value of public-utility product purchase contract.
The bus ticket prices shall be set by the People's Committees of the provinces or centrally-run cities.
2. Expenses for public-utility activities of public passenger transportation by buses
Expenses for public passenger transportation activities of the passenger bus transportation enterprises are reasonable and valid expenses under the provisions in the Finance Ministry's Circular No.18/2002/TT-BTC of February 20, 2002 guiding the implementation of the Government's Decree No.26/2001/ND-CP of June 4, 2001 and Decree No.30/1998/ND-CP of May 13, 1998 detailing the implementation of the Enterprise Income Tax Law.
To suit the reality of activities of public passenger transportation by buses, a number of expenses are prescribed as follows:
a/ Expenses for wages and wage allowances:
+ Wages in the State enterprises shall be determined as follows:
- The basic wage: To be determined according to the Government's Decree No.26/CP of May 23, 1993 temporarily providing the new wage regime in enterprises; Decree No.28/CP of March 28, 1997 on renovating wages and incomes in the State enterprises; Decree No.03/2003/ND-CP of January 15, 2003 on adjustment of wages, social allowances and further renewal of wage management mechanism, and the Labor, War Invalids and Social Affairs Ministry's circulars guiding the above decrees.
- The allowances include the increase coefficients of the minimum wage, hazardous allowances, travel allowances, responsibility allowances, which shall be determined under the guidance of the Ministry of Labor, War Invalids and Social Affairs.
The provincial/municipal Services of Labor, War Invalids and Social Affairs shall have to guide enterprises in the implementation thereof.
+ For enterprises of other economic sectors: To comply with the State's regulations applicable to each type of enterprises and to be entitled to apply the provisions on wages like the State enterprises in the estimation of the costs of public-utility products.
b/ Fixed asset depreciation: Fixed assets being mass transit buses shall be depreciated according to their actual use capacity (by operating shifts), but the depreciation thereof must not exceed the level prescribed in Decision No.166/1999/QD-BTC of December 30, 1999 of the Finance Minister.
c/ Expenses for overhaul of fixed assets:
For fixed assets being mass transit buses, annually the enterprises shall be entitled to deduct in advance the expenses for overhaul of fixed assets, deduct in advance the expenses for inner tubes and tires according to quotas issued by competent agencies into their production costs and to retain the remainder of advance expenses for bus overhaul in the fiscal year upon the settlement thereof to carry out periodical asset overhauls.
d/ Enterprise management expenses shall include the expenses for the boards administering and supervising the operation of buses and the managerial apparatus of the enterprises.
e/ Other relevant expenses such as expenses for purchase of prints (bus tickets), civil liability insurance premiums, passenger insurance premiums and other expenses related to activities of public passenger transportation by buses according to regulations.
3. Handling financial results: