The mining-right grant fee is a mine’s first major financial obligation — paid for the right to extract reserves owned by the entire people — and also the one most often miscalculated, because it depends simultaneously on reserves, the grant price and the collection rate. Decree 193/2025/ND-CP simplified the formula compared with the old mechanism, but a simple formula does not remove disputes over its inputs.
The formula: T = Q x G x R
Under Decree 193/2025/ND-CP, the grant fee is the product of three elements: Q, the reserves or volume licensed for extraction (for mineral and hot water, flow rate times extraction duration); G, the grant price, determined as the provincial resource-tax price multiplied by a conversion coefficient in the decree’s appendix (Article 134); and R, the collection rate in the appendix for non-auctioned areas, or the rate at the winning bid for auctioned areas. The Department of Agriculture and Environment determines the amount, and the provincial People’s Committee chairperson approves it for provincially licensed mines.
Approval timing and the payment schedule
Determination and approval of the grant fee must finish within 30 days of the exploitation licence date under Article 135 of Decree 193/2025/ND-CP. The total is spread evenly across the licence years and paid in annual instalments rather than upfront in one sum — a schedule that matches project cash flow to actual extraction progress. The company receives payment notices from the tax authority and should reconcile the approved amount against reserves and the grant price at approval time, so errors can be challenged promptly.
What happens when the grant fee is in arrears
Late payment accrues late-payment charges under tax administration law and can be enforced by the tax authority like any financial obligation to the State. At the licence layer, failure to perform financial duties is one of the grounds for the licensing authority to consider suspending or revoking the exploitation licence under the Law on Geology and Minerals 54/2024/QH15. The fee must also be re-approved when reserves change, the number of instalments changes, or the grant price moves beyond the decree’s threshold — so extensions and licence amendments should budget for recalculation.
Is the grant fee deductible for corporate income tax
The grant fee is a cost directly attached to extraction and is deductible when determining taxable corporate income, allocated in line with the extraction period and output — not dumped arbitrarily into the payment year when the licence spans many years. Accounting and legal teams should align on the evidence file: the grant-fee approval decision, payment notices and receipts are the root documents both for bookkeeping and for defending the cost in a tax audit of the mine.
Frequently Asked Questions
How is the mining grant fee calculated?
Under Decree 193/2025/ND-CP, the fee equals licensed reserves (Q) times the grant price (G) times the collection rate (R). The grant price derives from the provincial resource-tax price times a conversion coefficient; the rate comes from the decree’s appendix or from the auction result where the area was auctioned.
What if a company falls behind on grant fees?
Arrears accrue late-payment charges under tax administration law and can be enforced by the tax authority. Non-performance of financial duties is also a ground for suspending or revoking the exploitation licence under the Law on Geology and Minerals 54/2024/QH15, so this obligation cannot be left hanging across periods.
Can the grant fee be deducted for CIT purposes?
Yes — it is a cost directly related to extraction and is deductible when determining taxable income, allocated across the extraction period and output rather than expensed in a single year. Keep the approval decision and payment receipts as the supporting file.
This article has been quality-reviewed by the FLAW AI Legal Council