Decree 27/2023/ND-CP regulating environmental protection fees for mineral exploitation

Recently, on May 31, 2022, the Government issued a Decree regulating environmental protection fees for mineral exploitation with number 27/2023/ND-CP. Accordingly, Decree 27/2023/ND-CP was issued and replaced Decree No. 164/2016/ND-CP dated December 24, 2016, of the Government on environmental protection fees for mineral exploitation.

Basic information of Decree 27/2023/ND-CP

• Symbol number: 27/2023/ND-CP.
• Document type: Decree.
• Date of issue: May 31, 2023.
• Effective date: July 15, 2023
• Issuing agency: Government.
• Signed by: Le Minh Khai.

Notable new points of Decree 27/2023/ND-CP

Regulations on environmental protection fees for mineral exploitation activities

Accordingly, the Decree regulating environmental protection fees for mineral exploitation activities is prescribed as follows:

• The environmental protection fee for mineral exploitation according to the provisions of the mineral law is equal to 60% of the fee for the corresponding mineral specified in the Fee Framework Schedule issued with Decree 27/2023/ND-CP.
• Regarding environmental protection fees for mineral exploitation (including cases where production and business activities of organizations and individuals do not aim to exploit minerals but collect minerals) are prescribed according to the Fee Framework Schedule issued with this Decree.

In addition, the Decree has amended the fee framework for mining stone for large blocks of fine art and white marble for the production of carbonate powder. Accordingly, additional regulations on fees for white marble producing carbonate powder are from 1,500 to 7,500 VND/ton.

Thus, according to the new Decree 27/2023/ND-CP, the fee for gravel, pebbles, grit, sand, clay, and stone as common construction materials has been increased compared to regulations in Decree 164/2016/ND-CP before. This contributes to encouraging the use of other materials to replace these minerals. At the same time, the fee framework for stone used as a common construction material was also adjusted in an upward direction, contributing to limiting fragmented, small, and ineffective exploitation, and encouraging the use of other materials instead.

Cases will be exempted from environmental protection fees for mineral exploitation

According to Decree 27/2023/ND-CP, cases will be exempted from environmental protection fees. This is a new point compared to Decree 164/2016/ND-CP before, which specifically stipulates as follows:

• Exemption from environmental protection fees for mineral exploitation activities to use as common construction materials in land areas under the land use rights of individual households or for the construction of projects of households and individuals in that area.
• Activities of exploiting soil and stone for leveling and construction of security and military works, natural disaster prevention, and disaster recovery.
• In cases where exploited land and stone are used for leveling and construction of security, military, natural disaster prevention, and disaster recovery projects while also being used for other purposes, that organization or individual must be responsible for determining the volume of soil and rock eligible for free use. Accordingly, the amount of land and rock used for other purposes will have to pay environmental protection fees for mineral exploitation.

Accordingly, this Decree also adds conditions for the exemption from environmental protection fees in cases where individuals or organizations use excavated soil or waste rock from the mining process to improve and restore the environment in the mining area according to the environmental improvement and restoration plan approved by the competent authority. This fee exemption regulation aims to encourage organizations and individuals to exploit minerals to improve and restore the environment.

Note: Determining the amount of excavated soil and waste rock that is exempt from environmental protection fees is based on the following documents:

• Minutes of acceptance of the volume of each stage of mining technology include soil and rock preparation, loading, transport, and rock disposal according to current legal regulations.
• The plan for renovation and environmental restoration is approved by a competent state agency according to the provisions of Clause 3, Article 67 of the Law on Environmental Protection.
• Mine closure dossiers must be approved by a competent state agency according to the provisions of mineral law.

Regulations on fee payers

Decree 27/2023/ND-CP has added regulations on fee payers to ensure consistency with the mineral law. Accordingly, fee payers include:

• Organizations and individuals exploit minerals according to the provisions of mineral law.
• Vietnamese or foreign organizations and individuals are allowed to exploit crude oil, natural gas, and coal gas based on petroleum contracts or perform petroleum services following the provisions of petroleum law.
• Organizations and individuals are allowed to exploit minerals on a small scale and sell to organizations and individuals acting as purchasing focal points, and organizations and individuals acting as purchasing focal points must commit in writing to agree to declare and pay on behalf of the exploiting organization or individual, the organization or individual acting as the purchasing focal point will be the person paying the fee.

Regarding the subject of the fee

Subjects of environmental protection fees for mineral exploitation are activities of exploiting crude oil, natural gas coal gas, or other metallic and non-metallic minerals as specified in the Fee Framework for environmental protection fees for mineral exploitation were promulgated together with this Decree.

In addition, the Decree also amends and supplements regulations on implementation organization. Accordingly, in Article 9 of Decree 27/2023/ND-CP, regulations have been added on coordination between tax authorities and natural resources and environment agencies in comparing information to limit fraud, and inconsistent declared information, easily causing loss of budget revenue.

The implementation of environmental protection fees for minerals as prescribed in Decree 27/2023/ND-CP will contribute to raising awareness and responsibility for the environmental protection of organizations and individuals exploiting minerals and strengthening mineral exploitation management. At the same time, encourages investment in technology development, and effective and economical exploitation of minerals associated with environmental protection. Contribute to preventing and limiting negative impacts on the environment, overcoming environmental degradation and pollution caused by mineral exploitation activities, and protecting and regenerating the environmental landscape where minerals are exploited.

Fee calculation method

Adding a fee calculation method for minerals containing many minerals and useful minerals will be done according to the formula:

F = [(Q1 x f1) + (Q2 x f2)] x K.

In there:

• F is the amount of environmental protection fee payable in the period (month).
• Q1 is the volume of excavated soil and waste during the fee payment period (m3).
• f1 is the fee rate for the amount of excavated soil and waste: 200 VND/m3.
• Q2 is the total volume of raw minerals exploited during the fee payment period (tons or m3).
• f2 is the corresponding fee level for each type of mineral exploited (VND/ton or VND/m3).
• K is the fee calculation coefficient according to the mining method, in which open-cast mining (including mining by water power such as mining titanium, sand, and gravel in river beds, streams, hydroelectric reservoir beds, irrigation, estuaries sea): K = 1,1. Underground mining and other forms of exploitation (exploitation of crude oil, natural gas, natural mineral water, and the remaining cases): K = 1.

Besides, this Decree also added fees for determining the quantity of raw minerals for the main minerals and each accompanying mineral. The fee in this case will be equal to the ratio of each type of primary mineral in the total volume of raw minerals = (Average content of each type of mineral in the exploited raw ore/ Total average content of minerals contained in exploited raw ores).

Organize fee collection

In addition, to synchronize and unify different legal documents and avoid repeating regulations on fee declaration and payment, the Decree has also amended and replaced Article 3 in Decree 164/2016/ND-CP regulating the regulation on fee collection organizations will be the tax agency directly managing the area where mineral exploitation activities take place and was amended to state that the environmental protection fee collection organization will be the replacement agency according to the provisions of law on tax management.

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