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Value-added tax (VAT) For China Company

Updated:2020-4-16 14:54:27    Source:www.tannet-group.comViews:506

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The sales or importation of goods, the provision of services, and the sales of intangible properties and immovable properties are subject to VAT. For general VAT payers, input VAT can be credited against output VAT.

The applicable VAT rate for general VAT payers from 1 April 2019 are set out in the following table, and the rate for small-scale VAT payers is 3%.
Industries Applicable VAT rate 
Sales or importation of goods 13%
Sales or importation of necessity goods (e.g. agricultural products, water, gas) 9
Provision of repairs, replacement, and processing services 13%
Tangible movable property leasing services 13%
Transportation services, postal services, basic telecommunications services, construction services, immovable property leasing services, sales of immovable properties, transfer of land-use right 9%
Value-added telecommunications services, financial services, modern services (except for leasing services), consumer services, sales of intangible properties (except for land-use right) 6%
Exportation of goods; exportation of repair, replacement, and processing services; international transportation services and spacecraft transportation services; exported services that are completely consumed outside China, including:
1.Research and development (R&D) services.
2.Energy performance contracting services.
3.Design services.
4.Production and distribution services for radio, film, and television programs.
5.Software services.
6.Circuit design and testing services.
7.Information system services.
8.Process management services.
9.Offshore outsourcing services.
10.Transfer of technology. 
For taxpayers that are eligible for the above zero rate, generally they may be entitled to a credit or refund of the input VAT incurred.

The VAT refund rate for exported services is the same as the applicable VAT rate. For exported goods, the VAT refund rates range from 0% to 13%. There is a prescribed formula for determining the amount of refund, under which full refund of input VAT is not available to many exported goods and the exporter will suffer different degrees of export VAT costs.

In addition, certain taxable activities, including a few types of sale of goods, services, and cross-border transactions, are applicable to the VAT exemption treatment. In that respect, the relevant input VAT incurred cannot be credited or refunded.


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