Great Summary of New Tax Policies in 2015
General Administration of Customs Announcement No. 2 of 2015 - Announcement on Further Adjustment of Consumption Tax on Imports of Refined Oil (General Administration of Customs Announcement No. 2 of 2015)
Key Points to Note: Since January 13, 2015, the unit tax of consumption tax on the import of gasoline, naphtha, solvent oil and lubricating oil has been raised from RMB 1.4/liter to RMB 1.52/liter; the unit tax of consumption tax on the import of diesel oil, jet fuel and fuel oil has been raised from RMB 1.1/liter to RMB 1.2/liter, and the collection of aviation kerosene continues to be temporarily suspended.
Notice of the Ministry of Finance and State Administration of Taxation on Continuing to Increase Consumption Tax on Refined Oil (Cai Shui [2015] No. 11)
Key Points to Note: Since January 13, 2015, the unit tax of consumption tax for gasoline, naphtha, solvent oil and lubricating oil has been raised from RMB 1.4/liter to RMB 1.52/liter; the unit tax of consumption tax for diesel oil, aviation kerosene and fuel oil has been raised from RMB 1.1/liter to RMB 1.2/liter, and aviation kerosene has continued to be suspended from collection.
Announcement of the Ministry of Finance on the Implementation of Tax Refund Policy for Overseas Travelers' Departure for Shopping (Announcement of the Ministry of Finance No. 3 of 2015)
Points to note: Since January 6, 2015, the policy of refunding value-added tax (VAT) to overseas travelers (foreigners and compatriots from Hong Kong, Macao and Taiwan who have resided in China for not more than 183 consecutive days) for their purchases from tax refund stores when they leave China at the departure ports (ports officially opened to the outside world in the regions where the tax refund policy is implemented and where there are tax refund agencies, including air ports, water ports and land ports) has been implemented in eligible regions throughout the country. The policy of refunding value-added tax (VAT) on items purchased at tax refund shops when departing from the country.
Circular of the Ministry of Finance and the State Administration of Taxation on the Adjustment of Export Tax Refund Rates for Certain Products (Cai Shui [2014] No. 150)
Key Points: From January 1, 2015: increase the export tax rebate rate for some high value-added products, corn processing products, textiles and garments; cancel the export tax rebate for boron-containing steel. From April 1, 2015: reduce the export tax rebate rate for gear hair.
Notice of the State Administration of Taxation of the Ministry of Finance on the Export Tax Refund Policy for Goods with Precious Metals and Gemstones as the Main Raw Materials (Cai Shui [2014] No. 98)
Points to note: export enterprises and other units exporting goods, if more than 80% of the cost of its raw materials for the raw materials listed in the Annex to this Circular, should be in accordance with the cost of the highest proportion of the raw materials of the value-added tax, consumption tax policy. The VAT and consumption tax policies of the raw materials refer to the VAT and consumption tax policies applicable to the commodity codes corresponding to such raw materials listed in the Annex to this Circular in the Export Tax Refund Rate Library.
The Notice of the Ministry of Finance and the State Administration of Taxation on the Policies of Value-added Tax and Consumption Tax on the Export of Goods and Services (Cai Shui [2012] No. 39), Article 9(2)(6) and Annex 9 are hereby repealed at the same time.
Ministry of Finance General Administration of Customs State Administration of Taxation on the abolition of bonded policy on imports of steel under processing trade Supplementary Notice (Caixa Tariff [2014] No. 54)
Key Points to Note: Customs duties and import linkage taxes are levied on steel products imported under processing trade with 78 tariff codes; for contracts signed before December 31, 2014 and actually imported before June 30, 2015, processing trade is allowed to continue in bonded form during the validity period of the contract.
Circular of the Ministry of Finance and the State Administration of Taxation on the Application of VAT Refund (Exemption) Policies for Goods Entering the China-Harbin Khorgos International Border Cooperation Center (Cai Shui [2015] No. 17)
Key Points: After the sealing and acceptance of the China-Harbin Khorgos International Border Cooperation Center, the VAT refund (exemption) policy will be applied to the construction materials for infrastructure (except public infrastructure) and equipment for self-use of facilities within the center that enter the center from the Chinese territory as if they were exported goods.
Tax policies effective from February 1, 2015
Circular of the Ministry of Finance and the State Administration of Taxation on the Collection of Consumption Tax on Batteries and Coatings (Cai Shui [2015] No. 16)2015〕16号）
Points to note: Batteries and paints are included in the scope of consumption tax (see the Annex for specific tax items), and are levied in the production, commissioned processing and import segments, with an applicable tax rate of 4%. Mercury-free primary batteries, nickel metal hydride batteries (also known as "nickel hydride batteries" or "nickel-metal hydride batteries"), lithium primary batteries, lithium-ion batteries, solar batteries, fuel cells and all-vanadium batteries are exempted from consumption tax.
Before December 31, 2015, the consumption tax on lead storage batteries was suspended; since January 1, 2016, the consumption tax on lead storage batteries has been levied at a rate of 4%.
Announcement of the State Administration of Taxation on the Applicable VAT Rate for Peony Seed Oil (Announcement of the State Administration of Taxation No. 75 of 2014)
Key Note: Peony seed oil belongs to edible vegetable oil and is subject to 13% VAT rate.
Peony Seed Oil is a product made from the seed kernels of Danfeng Peony and Purple-spotted Peony through the processes of pressing, decoloration and deodorization.
Measures for the Administration of Vehicle Acquisition Tax Collection (State Administration of Taxation Decree No. 33)
Points to note: The minimum taxable price refers to the taxable price of the vehicle purchase tax approved by the State Administration of Taxation based on the vehicle price information provided by the motor vehicle manufacturing enterprises or dealers, with reference to the average market transaction price. (Editor's Note: Compared with the original provision, "vehicle price information provided by dealers" has been added).
Measures for Hearing Major Tax Cases (State Administration of Taxation Decree No. 34)
Tips: The trial of major tax cases shall be conducted in a combination of written trial and meeting trial.
The Inspection Bureau shall, in accordance with the opinion on the hearing of major tax cases, make tax treatment and penalty decisions and other relevant documents, affix the seal of the Inspection Bureau and deliver them for execution.
General Anti-Tax Avoidance Administrative Measures (for Trial Implementation) (State Administration of Taxation Decree No. 32)
Abstract: These Measures are applicable to the special tax adjustments implemented by the tax authorities in accordance with the law on tax avoidance arrangements implemented by enterprises that do not have reasonable commercial purposes but obtain tax benefits.
The tax benefit refers to the reduction, exemption or postponement of the taxable amount of enterprise income tax.
Tax avoidance arrangements are characterized by two features: obtaining tax benefits as the sole or main purpose; and obtaining tax benefits in a manner that conforms to the provisions of the tax law but is inconsistent with its economic substance.
