¡¡¡¡To the local taxation bureaus and sub-bureaus in each district
and county£º
We are hereby forwarding you the Reply of State Administration of
Taxation on Implementing Approach to Preferential Income Tax for
Newly Established Enterprise (Guo Shui Han [2003] No.1239). Please
implement in accordance with it.
January 12, 2004
State Administration of Taxation
Guo Shui Han [2003] No. 1239
Reply of State Administration of Taxation on Implementing Approach
to Preferential Income Tax for Newly Established Enterprises
Beijing State Taxation Bureau:
We have received your Request for Instruction on Starting Date of
Enterprise Income Tax Reduction and Exemption (Jing Guo Shui Fa
[2003] No. 240). After study, we hereby reply as follows:
Since the Notice of State Administration of Taxation on Several
Matters Concerning Enterprise Income Tax (Guo Shui Fa [1997] No.191)
came into effect, the bureaus in each local place have different
understandings on the operation or production date of a newly established
enterprise. In order to enable the bureaus in each place to correctly
understand and implement the rules, we unify the operation or production
date of a newly established enterprise as the establishment date
listed in the taxpayer¡¯s business license. In case the date listed
in an enterprise¡¯s business license is before June 30, the same
year shall be a taxpaying year and the enterprise shall enjoy periodic
tax reduction and exemption. In case the said date is after June
30, the enterprise may directly apply to the competent tax authority
for delaying the implementation period of periodic tax reduction
and exemption to the next year, and it shall pay the income tax
of this year. If an enterprise has chosen this method and suffers
losses in the following year, the tax paid in the prior year shall
not be refunded. The loss year shall be the implementation period
of tax reduction and exemption, and the amount of loss shall be
remedied with the income obtained in following years.
In addition, since the enterprise income tax is collected per annum,
the tax authorities shall examine and approve enterprise income
tax reduction and exemption per year.
November 18, 2003 ¡¡
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