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THE
MINISTRY OF CONSTRUCTION
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SOCIALIST
REPUBLIC OF VIET NAM
Independence - Freedom - Happiness
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No.
01/2006/TT-BXD
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Hanoi,
May 17, 2006
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CIRCULAR
GUIDING THE PROJECTION AND MANAGEMENT OF EXPENSES FOR THE
CONSTRUCTION OF INFRASTRUCTURE WORKS UNDER THE PROGRAM ON SOCIOECONOMIC
DEVELOPMENT IN SPECIALLY DISADVANTAGED COMMUNES IN ETHNIC MINORITY AND
MOUNTAINOUS AREAS IN THE 2006-2010 PERIOD
Pursuant to Construction Law No. 16/2003/QH11 of
November 26, 2003, of the National Assembly of the Socialist Republic of
Vietnam;
Pursuant to the Government's Decree No.
16/2005/ ND-CP of February 7, 2005, on the management of construction
investment projects, and documents guiding the implementation of the Decree;
Pursuant to the Prime Minister's Decision No. 07/2006/QD-TTg of January 10,
2006, approving the program on
socio-economic development in specially disadvantaged communes in ethnic
minority and mountainous areas for the 2006-2010 period;
Pursuant to the Government's Decree No.
36/2003/ND-CP of April 4, 2003,
defining the functions, tasks, powers and organizational structure of the
Ministry of Construction;
After reaching agreement with the Nationalities Committee and consulting
concerned ministries and branches, the
Ministry of Construction hereby guides the projection and management of
expenses for the construction of
infrastructure works under the Program on socio-economic development in
specially disadvantaged communes in ethnic minority and mountainous areas in the 2006-2010 period as follows:
This Circular guides the projection and
management of expenses for the construction of infrastructure works with capital funded by the Program on
socio-economic development in specially disadvantaged
communes in ethnic minority and mountainous areas in the 2006-2010 period
(hereinafter referred to as Program 135 - second phase for short) and applies
to construction projects capitalized at no more than VND 7 billion for which
only an economic-technical report is required.
This Circular
also applies to projects outside Program 135 which have their capital
integrated into Program 135 and accounting
for less than 50% of total investment capital for the construction of a single
work. For projects with the capital contribution proportion equal to or
higher than 50%, the presidents of provincial-level
People's Committees shall decide on the application of this Circular
thereto.
This Circular does not apply to other
construction projects.
PART
II
PROJECTION
AND MANAGEMENT OF EXPENSES FOR THE CONSTRUCTION OF WORKS
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1.
Construction expenses
In the
construction cost estimates of works, construction
expenses shall be projected for principal works, auxiliary works, works
in service of construction, and make-shift houses. Construction expenses shall
be determined by estimation. An estimate of construction expenses shall cover
direct expenses, general expenses,
pre-determined taxable income and value added tax.
a/ Direct expenses include: expense for materials,
labor expense, expense for use of construction machines and other direct
expenses.
- Expense for materials: Expense for materials shall
be determined on the basis of the work volume projected in the construction drawing design and unit prices of materials needed for the relevant
construction job set in the
construction unit price of a province and differences in material quantities (if any). Construction materials
exploited on the spot such as timber, bamboo,
sand, stone, gravel, etc. must satisfy quality requirements and their
expenses shall be calculated according to their actual buying prices which are
compatible with the prevailing prices of construction materials in localities
where works are built or with construction material prices jointly notified by
local Finance Services and Construction Services.
- Labor
expense: Labor expense shall be determined
on the basis of the work volume projected in the construction drawing
design and the unit price of labor needed
for the relevant construction job set in the construction unit price of
a province plus labor expense adjustment (if any). When part or all of construction
work is contracted to local people, the expense for the performance of this
contractual work shall be agreed upon by the two involved parties in
compatibility with the direct labor expense in the estimation of construction
expenses.
- Expense for use
of construction machines: Expense for use of construction machines shall be determined on the basis of the work volume
projected in the construction drawing design and the unit prices of
construction machines for the relevant construction job set in the construction
unit price of a province plus construction
machine expense adjustment (if any). For construction jobs performed
manually instead of use of construction
machines, the expense for manual labor shall not exceed the expense for
use of construction machines projected in the estimate of construction
expenses.
- Other direct
expenses: These expenses are for water pumping, mud dredging, tests of
materials, transport of labor and construction equipment to and within
construction sites, and other expenses according to general regulations. Other
direct expenses shall be calculated in a
block amount equal to 1.5% of the
total expenses for materials, labor and use of construction machines.
b/ General
expenses: These expenses include expense
for production management and direction at construction sites, expense
for workers, expense for construction services at construction sites and other expenses. General expenses shall be calculated as
a percentage (%) of direct expenses, which varies between different kinds
of works as provided for in Appendix I to this Circular. Particularly for work
volumes performed by commune communities themselves,
general expenses shall be equal to 50% of the levels specified in
Appendix I to this Circular.
c/
Pre-determined taxable income shall be calculated
as a percentage (%) of the aggregate of direct expenses and general expenses, depending on each kind of work as provided for in Appendix I to
this Circular.
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e/ Expense for
building make-shift houses at construction sites shall be calculated as a block
amount equal to 2% of the post-tax value of
estimated construction expenses. The expense for building make-shift
houses at construction sites shall not be allowed
for work volumes performed by local people.
Expenses for
work volumes performed by local people with
materials and supplies exploited on the spot and for work items built with the people's contributions shall be projected in separate cost estimates
which shall not include pre-determined taxable income, value added tax and expenses for making make-shift houses. The
sheet of estimated construction
expenses of works shall be drawn up
according to the provisions of Appendix 2 to this Circular.
2. Equipment expenses: Equipment expenses consist of expenses for procurement of equipment
and expenses for equipment installation, test and adjustment (if any).
Expenses for procurement
of equipment consist of buying prices, expense for transportation of equipment
to the construction sites, expense for storage, expense for preservation and
maintenance in storehouses and yards at
construction sites, taxes and insurance for equipment. Expenses for procurement of equipment shall be determined on
the basis of the quantity and category of each kind of equipment or all equipment of a work and the unit
price of each kind of equipment or
all equipment of a work.
Expenses for
equipment installation, test and adjustment
(if any) consist of direct expenses (materials, labor, construction machines and other direct charges), general
expenses, pre-determined taxable income and value added tax. These expenses shall be presented in a cost estimate
like construction expenses.
3. Other expenses
a/ Expenses for making economic-technical reports
Expenses for making an economic-technical report shall
be calculated as a percentage (%) of the aggregate of construction expenses and
equipment expenses stated in the approved
economic-technical report and
prescribed for each kind of work as follows:
- For civil works such as village community
houses, dispensaries, marketplaces, shops, agricultural extension
centers in commune clusters, accommodations and auxiliary structure for
semi-boarding pupils, public facilities, health stations, schools and other
civil works: 4.07%.
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- For traffic works: Roads linking hamlets or
villages to commune centers, inter-village roads, bridges, sluices and
other traffic works: 3.5%.
- For
small-sized irrigation works: 3.91%.
- For
daily-life water supply works: 3.75%.
- If typical designs
or model designs issued by competent agencies are used in economic-technical
reports, expenses for making such reports shall be calculated on the basis of the aforesaid rate multiplied by an
adjustment coefficient of 0.6.
b/ Fees for appraisal of economic-technical
reports and expenses for
verification of construction drawing designs
and construction cost estimates of works shall be determined as follows:
Fees for
appraisal of economic-technical reports shall be determined according to regulations
of the Finance Ministry.
For all kinds of works, expenses for verification
of construction drawing designs and construction cost estimates included in the economic-technical
reports shall be equal to 0.3% of construction expenses (exclusive of value
added tax) in the approved expenses for the construction of works, of which expenses for verification of construction cost
estimates shall account for 50%.
c/ Expenses for construction survey: Expenses for construction survey, such as those for geological
survey drills; earth and rock sampling; measurement and mapping of construction sites shall be determined
by estimation on the basis of work volumes and survey unit prices
promulgated by provincial-level People's Committees.
d/ Expenses for compensation, ground clearance and resettlement: These expenses shall be
determined according to compensation prices promulgated by
provincial-level People's Committees.
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- For
district-level project management units: Expenses
for their operation shall be equal to 2.7% of the aggregate of
construction expenses and equipment expenses
stated in the approved economic-technical reports.
- For
commune-level project management units: Expenses
for their operation shall be equal to 2.2% of the aggregate of
construction expenses and equipment
expenses of works stated in the approved economic-technical reports.
Expenses
arising from the management of the Program and the operation of the Program's
local steering committees shall not be
included in expenses for the
operation of project management units and shall not be accounted as expenses for project execution.
f/ Expenses for selection of construction
contractors and equipment supply contractors shall not exceed 0.4% of
construction expenses (exclusive of value added
tax) in the approved construction cost estimates of works, of which expenses for compilation of bidding dossiers
shall account for 40%.
g/ Expenses for
construction supervision and equipment installation supervision:
Expenses for
hiring construction supervision consultants shall be equal to 2.7% of
construction expenses (exclusive of value added tax) in the approved expenses
for the construction of works.
Expenses for
commune supervisory boards shall be equal to 1% of construction expenses
(exclusive of value added tax) included in
the approved expenses for the construction of works.
Expenses for
equipment installation consultancy and supervision shall be equal to 1% of
equipment expenses (exclusive of value added tax) included in the approved expenses for the construction of
works.
h/ Expenses for
verification and approval of financial settlement statements and expenses for investment capital audit shall be calculated
according to regulations of the Finance Ministry.
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4.
Contingency expenses: In construction cost estimates of works, contingency
expenses shall be equal to 5% of the
aggregate of construction expenses, equipment expenses and other
expenses.
A sheet of
general construction cost estimate of works shall be made according to a set
form.
This Circular
takes effect 15 days after its publication in "CONG BAO" and replaces
the Construction Ministry's Circular No.
12/2000/TT-BXD of October 25, 2000, guiding the management of expenses for investment in infrastructure works
under Program 135.
In the course
of implementation, concerned localities and units are requested to report any
inappropriate matters that need to be amended or supplemented to the Ministry of Construction for study and
settlement.
FOR
THE MINISTER OF CONSTRUCTION
VICE MINISTER
Dinh Tien Dung
APPENDIX 1
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Ordinal number
Type of works
General expenses
Pre-determined taxable income
1
Civil works: Village community houses,
dispensaries, marketplaces, shops,
agricultural extension centers of commune
clusters, accommodations and auxiliary works for semi-boarding pupils, community public facilities, health
stations, schools and other civil works
6.6
5.5
2
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6.0
6.0
3
Traffic works: Roads linking villages and
hamlets to commune centers,
inter-village roads, bridges, sluices and other traffic works
5.8
6.0
4
Small-sized
irrigation works
6.0
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5
Daily-life
water supply works
5.0
5.5
APPENDIX
NO. 2
SHEET OF ESTIMATED
CONSTRUCTION EXPENSES OF WORKS
(Issued together with Circular No.
01/2006/TT-BXD of May 17, 2006)
Ordinal number
Expense items
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Signs
I
DIRECT
EXPENSES
1
Material
expense
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The volume of each kind of job
x
Unit price of relevant materials
+
Difference in material quantities (if any)
VL
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2
Labor expense
Aggregate of
The volume of each kind of job
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Unit price of relevant labor
+
Labor expense adjustment (if any)
NC
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3
Construction
machine expense
Aggregate of
The volume of each kind of job
x
Unit price of relevant construction machines
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Construction machine expense adjustment (if any)
M
4
Other direct
charges
1.5% x (VL+NC + M)
TT
Total direct
expenses
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T
II
GENERAL
EXPENSES
T x prescribed rate
C
Estimated
construction expenses
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Z
III
PRE-DETERMINED
TAXABLE INCOME
(T + C) x prescribed
rate
TL
Pre-tax value
of estimated construction expenses
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G
IV
VALUE ADDED
TAX
G x TXDGTGT
GTGT
Post-tax
value of estimated construction expenses
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GXDCPT
Expenses for
building make-shift houses at construction sites
G x 2% x (1+TXDGTGT)
GXDLT
Total
construction expenses of works
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In which:
G: Pre-tax value of estimated construction expenses
of principal works, auxiliary works and works in service of construction.
GXDCPT: Post-tax value of
estimated construction expenses of principal works, auxiliary works and works
in service of the construction.
TXDGTGT: Value added
tax rate prescribed for construction jobs.
Note: For works built by local people, expenses
for building make-shift houses at construction sites shall not be
allowed.-