|
GUO WU YUAN LING [134] 1993.12.13
Article 1 All units and individuals, within the territory
of the People's Republic of China, who are engaged in the sales
of goods, provision of processing, repair and replacement services,
and the import of goods, are persons liable to pay Value-Added Tax
( hereinafter referred to simply as "taxpayers"), and
shall pay VAT in accordance with these Regulations.
Article 2 VAT Rates:
A. For taxpayers selling or importing goods, other than those stipulated
in items (2) and (3) of this Article, the tax rate shall be 17%.
B. For taxpayers selling or importing the following goods, the
tax rate shall be 13%:
a. Food grains, edible vegetable oils;
b. Tap water, heating, air conditioning, hot water, coal gas, liquefied
petroleum gas, natural gas, methane gas, coal/charcoal products
for household use;
c. Books, newspapers, magazines;
d. Feeds, chemical fertilizers, agricultural chemicals, agricultural
machinery and covering plastic-film for farming;
e. Other goods as regulated by the State Council.
C. For taxpayers exporting goods, the tax rate shall be 0%, except
as otherwise stipulated by the State Council.
D. For taxpayer providing processing, repair and replacement services
(hereinafter referred to as "taxable services"), the tax
rate shall be 17%.
Any adjustments to the tax rates shall be determined by the State
Council.
Article 3 For taxpayers dealing in goods or providing taxable
services with different tax rates shall be accounted for separately.
If the sales amounts have not been accounted for separately, the
higher tax rates shall apply.
Article 4 Except as stipulated in Article 13 of these Regulations,
for taxpayers engaged in the sales of goods or the provision of
taxable services (hereinafter referred to as "selling goods
or taxable services" ), the tax payable shall be the balance
of output tax for the period after deducting the input tax for the
period. The formula for computing the tax payable is as follows:
Tax payable = Output tax payable for the period-Input tax for the
period
If the output tax for the period is less than and insufficient
to offset against the input tax for the period, the excess input
tax can be carried forward for set-off in the following periods.
Article 5 For taxpayers selling goods or taxable services,
the output tax shall be the VAT payable calculated based on the
sales amounts and the tax rates prescribed in Article 2 of these
Regulations and collected from the purchasers, The formula for computing
the output tax is as follows:
Output tax =Sales amount ˇÁ Tax rate
Article 6 The sales amount shall be the total compensation
and all other charges received from the purchasers by the taxpayer
selling goods or taxable services, but excluding the output tax
due.
The sales amount shall be calculated in Renminbi. The sales amount
of the taxpayer settled in foreign currencies shall be converted
into Renminbi according to the exchange rate prevailing in the foreign
exchange market.
Article 7 Where the price used by the taxpayer in selling
goods or taxable services is obviously low and without proper justification
, the sales amount shall be determined by the competent tax authorities.
Article 8 For taxpayers who purchase goods or receive taxable
services (hereinafter referred to as "purchasing goods or taxable
services"), VAT paid or borne shall be restricted to the amount
of VAT payable as indicated on the following VAT deduction documents:
The input tax allowed for deduction from output tax, apart from
the situations specified in Paragraph 3 of this Article,
is limited to the VAT amounts noted on the deduction documents listed
below.
A. VAT indicated in the special VAT invoices obtained from the
sellers;
B. VAT indicated on the tax payment receipts obtained from the
customs office.
The deductible input tax for the purchasing of tax exempt agricultural
products is calculated based on a deemed deduction rate at 10% on
the actual purchasing price. The formula for calculating the input
tax is as follows:
Input tax = Purchasing price ˇÁDeduction rate
Article 9 Where taxpayers purchasing goods or taxable services
have not obtained and kept the VAT deduction documents in accordance
with the regulations, or the VAT payable and other relevant items
in accordance with the regulations are not indicated on the VAT
deduction document, no input tax shall be deducted from the output
tax.
Article 10 Input tax on following items shall not be deducted
from the output tax:
A. Fixed assets purchased;
B. Goods purchased or taxable services used for non-taxable items;
C. Goods purchased or taxable services used for tax exempt items;
D. Goods purchased or taxable services used for group welfare or
personal consumption;
E. Abnormal losses of goods purchased;
F. Goods purchased or taxable services consumed in the production
of work-in-progress or finished goods which suffer abnormal losses.
Article 11 Small-scale taxpayers engaged in selling goods
or taxable services shall use a simplified method for calculating
the tax payable.
The standard for small-scale taxpayers is determined by the Ministry
of Finance.
Article 12 The rate levied on the small-scale taxpayers
goods or taxable services shall be 6%.
Any adjustment to tax rates shall be determined by the State Council.
Article 13 For small-scale taxpayers selling goods or taxable
services, the tax payable shall be calculated on the sales amount
and the tax rate stipulated in Article 12 of these Regulations.
No input tax shall be deducted. The formula for calculating the
tax payable is as follows:
Tax payable = Sales amount ˇÁTax rate.
The sales amount shall be determined in accordance with Article
6 and Article 7 of these Regulations.
Article 14 Small-scale taxpayers with sound accounting who
can provide accurate taxation information may, upon the approval
of the competent tax authorities, not be treated as small-scale
taxpayers. The tax payable shall be computed pursuant to the relevant
stipulations of these Regulations.
Article 15 For taxpayers importing goods, tax payable shall
be computed based on the composite assessable price and the tax
rates prescribed in Article 2 of these Regulations. No tax will
be deducted. The formulas for computing the composite assessable
price and the tax payable are as follows:
Composite assessable price = Customs dutiable value + Customs Duty
+ Consumption Tax
Tax payable = Composite assessable price ˇÁ Tax rate
Article 16 The following items are exempt from VAT:
A. Self-produced agricultural products sold by agricultural producers;
B. Contraceptive medicines and devices;
C. Antique books;
D. Importation of instruments and equipment directly used in scientific
research, experiment and education;
E. Importation of materials and equipment from foreign governments
and international organizations as assistance free of charge;
F. Equipment and machinery required to be imported under contract
processing, contract assembly and compensation trade;
G. Articles imported directly by organizations for the disabled
for special use by the disabled;
H. Sale of goods which have been used by the sellers.
Except as stipulated in the above paragraph, the VAT exemption
and reduction items shall be regulate d by the State Council. Local
governments or departments shall not regulate any tax exemption
or reduction items.
Article 17 For taxpayers engaged in tax exempt or tax reduced
items, the sales amounts for tax exempt or tax reduced items shall
be accounted for separately. If the sales amounts have not been
separately accounted for, no exemption or reduction is allowed.
Article 18 Taxpayers whose sales amounts have not reached
the VAT minimum threshold stipulated by the Ministry of Finance,
shall be exempted from the VAT.
Article 19 The time at which VAT liability arises is as
follows:
A. For sales of goods or taxable services, it is the date on which
the sales sum is received or the documented evidence of right to
collect the sales amount is obtained.
B. For importation of goods, it is the date of import declaration.
Article 20 VAT shall be collected by the tax authorities.
VAT on the importation of goods shall be collected by the customs
office on behalf of the tax authorities.
VAT on self-used Articles brought or mailed into China by individuals
shall be levied together with Customs Duty. The detailed measures
shall be formulated by the Tariff Policy Committee of the State
Council together with the relevant departments.
Article 21 Taxpayers selling goods or taxable services shall
issue special VAT invoices to the purchasers. Sales amounts and
output tax shall be separately indicated in the special VAT invoices.
Under one of the following situations, the invoice to be issued
shall be an ordinary invoice rather than the special VAT invoice:
A. Sale of goods or taxable services to consumers;
B. Sale of VAT exempt goods;
C. Sale of goods or taxable services by small-scale taxpayers.
Article 22 The location for payment of VAT is as follows:
A. Businesses with a fixed establishment shall report and pay tax
with the local competent tax authorities where the establishment
is located. If the head office and branch are not situated in the
same county (or city ), they shall report and pay tax separately
with their respective local competent tax authorities. The head
office may, upon the approval of the State Administration for Taxation
or its authorized tax authorities, report and pay tax on a consolidated
basis with the local competent tax authorities where the head office
is located.
B. Businesses with a fixed establishment selling goods in a different
county (or city ) shall apply for an outbound business activities
tax administration certificate from the local competent tax authorities
where the establishment is located and shall report and pay tax
with the local competent tax authorities where the establishment
is located. Businesses selling goods and taxable services in a different
county (or city ) without the outbound business activities tax administration
certificate issued by the local competent tax authorities where
the establishment is located, shall report and pay tax with the
local competent tax authorities where the sales activities take
place. The local competent tax authorities where the establishment
is located shall collect the overdue tax which has not been reported
and paid to the local competent tax authorities where the sales
activities take place.
C. Businesses without a fixed base selling goods or taxable services
shall report and pay tax with the local competent tax authorities
where the sales activities take place.
D. For importation of goods, the importer or his a gent shall report
and pay tax to the customs office where the imports are declared.
Article 23 The VAT assessable period shall be one day, three
days, five days, ten days, fifteen days or one month. The actual
assessable period of the taxpayer shall be determined by the competent
tax authorities according to the magnitude of the tax payable of
the taxpayer; tax that cannot be assessed in regular periods may
be assessed on a transaction-by-transaction basis.
Taxpayers that adopt one month as an assessable period shall report
and pay tax within ten days following the end of the period. If
an assessable period of one day, three days, five days, ten days
or fifteen days is adopted, the tax shall be prepaid within five
days following the end of the period and a monthly return shall
be filled with any balance of tax due settled within ten days from
the first day of the following month.
Article 24 Taxpayers importing goods shall pay tax within
seven days after the issuance of the tax payment certificates by
the customs office.
Article 25 Taxpayers exporting goods with the applicable
0% tax rate shall, upon completion of export procedures with the
customs office, apply for the tax refund on those export goods to
the tax authorities on a monthly basis based on such relevant documents
as the export declaration document. The detailed measures shall
be formulated by the State Administration for Taxation.
Where the return of goods or the withdrawal of the customs declaration
occurs after the completion of the tax refund on the export goods,
the taxpayer shall repay the tax refunded according to the laws.
Article 26 The collection and administration of VAT shall
be implemented in accordance with the relevant regulations of the
"Law of the People's Republic of China on Tax Collection and
Administration" and these Regulations.
Article 27 The collection of VAT from foreign investment
enterprises and foreign enterprises shall be conducted in accordance
with the resolutions of the standing Committee of the National People's
Congress.
Article 28 The Ministry of Finance shall be responsible
for the interpretation of these Regulations; their detailed implementation
is determined by the Ministry of Finance.
Article 29 These Regulations take effect as of January 1,
1994. "The Draft Regulations of the People's Republic of China
on Value-Added Tax" and the "Draft Regulations of the
People's Republic of China on Product Tax" promulgated by the
State Council on September 18, 1984 are annulled at the same day.
|
