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Zero VAT Tax Rate of China May 11,2019.

1. The following services and intangible assets sold by units and individuals within the territory of the People's Republic of China (hereinafter referred to as “domestic”) shall be subject to zero tax rate:

(1) International transportation services.

1. Carrying passengers or goods out of the country.

2. Carrying passengers or goods into the country.

3. Carrying passengers or goods outside the country.

(2) Space transportation services.

(3) The following services provided to overseas units for complete consumption abroad:

1. Research and development services.

2. Contract energy management services.

3. Design services.

4. Production and distribution of radio and television programs (works).

5. Software services.

6. Circuit design and testing services.

7. Information system services.

8. Business Process Management Service.

9. Offshore service outsourcing business.

Offshore service outsourcing business, including information technology outsourcing services (ITO), technical business process outsourcing services (BPO), and technical knowledge process outsourcing services (KPO), the specific business activities involved, in accordance with "sales services, intangible assets, real estate Commentary corresponds to the execution of the business activity.

10. Transfer of technology.

(4) Other services as stipulated by the Ministry of Finance and the State Administration of Taxation




2. The following services and intangible assets sold by units and individuals within the territory are exempt from VAT, except for the zero-tax rate applicable to the VAT provided by the Ministry of Finance and the State Administration of Taxation:

(1) The following services:

1. Architectural services for engineering projects outside the country.

2. Engineering supervision services for engineering projects outside the country.

3. Engineering and exploration services for engineering and mineral resources outside the country.

4. Conference and exhibition venues for overseas conference and exhibition services.

5. Store warehousing services outside the country.

6. Tangible movable property leasing services for the subject matter used abroad.

7. Broadcasting of radio, film and television programs (works) provided abroad.

8. Cultural and sports services, educational and medical services, and travel services provided overseas.

(2) Postal service, collection service and insurance service for export goods.

Insurance services for export goods, including export cargo insurance and export credit insurance

(3) The following services and intangible assets provided to overseas units for full consumption abroad:

1. Telecommunications services.

2. Intellectual property services.

3. Logistics auxiliary services (except warehousing services, receiving services).

4. Forensic consulting services.

5. Professional technical services.

6. Business support services.

7. Advertising services for advertising outside the country.

8. Intangible assets.

(4) International transportation services provided by means of non-transportation means.

(5) Directly-funded financial services provided for monetary assets and other financial services between overseas entities, and the services are not related to domestic goods, intangible assets and real estate.

(6) Other services as stipulated by the Ministry of Finance and the State Administration of Taxation.



3. For international transportation service projects that have obtained relevant qualifications in accordance with relevant state regulations, if the taxpayer obtains relevant qualifications, the zero-tax rate policy for VAT shall apply. If not obtained, the VAT exemption policy shall apply.

The units or individuals in the territory provide the charter service. If the leased vehicles are used for international transportation services and Hong Kong, Macao and Taiwan transportation services, the lessor shall apply for the applicable zero value-added tax rate according to the regulations.

Units and individuals within the territory provide time-charting and wet-rental services to domestic units or individuals. If the lessee uses the leased means of transport to provide international transportation services and Hong Kong, Macao and Taiwan transportation services to other units or individuals, the lessee shall apply the zero-rate VAT rate. Units or individuals in the territory provide time-sale and wet-rental services to overseas units or individuals, and the zero-rated rate of VAT is applied by the lessor.

For international transportation services provided by domestic units and individuals in the form of non-transportation means, the actual carrier of the territory shall apply the zero-rate VAT rate; the operator without the means of transport of the means of transport shall apply the VAT exemption policy.


4. Units and individuals within the territory shall provide services or intangible assets with zero VAT rate. If they are subject to the simple taxation method, the VAT exemption method shall be implemented. If it is a general taxation method for applicable VAT, the production enterprise shall implement the tax exemption method. The foreign trade enterprise outsourcing service or the export of intangible assets shall be exempted from tax refund. The foreign trade enterprise directly exports the intangible assets of the service or self-developed, as if it were produced. Enterprises and their export goods shall be uniformly exempted from tax refund.

The tax rebate rate for services and intangible assets is the VAT rate applicable to them in accordance with Article 15(1) to (3) of the Pilot Implementation Procedures. If the competent tax authority determines that the export price is too high, it has the right to calculate the refund (exemption) tax according to the approved export price, and the approved export price is lower than the purchase price of the foreign trade enterprise. If the corresponding input tax amount is lower than the part, the tax will not be refunded and transferred to the cost.


5. Units and individuals in China who sell services or intangible assets with zero VAT rate may abandon the applicable zero-tax VAT rate and choose to exempt or pay VAT according to regulations. After abandoning the applicable zero-rate VAT rate, the applicable VAT zero tax rate may not be applied for another 36 months.


6. Units and individuals within the territory shall sell the service or intangible assets with zero VAT rate, and report to the tax authorities in charge of tax refund on a monthly basis for the VAT refund (exemption) tax procedures. The specific management measures shall be formulated separately by the Ministry of Finance and the Ministry of Finance of the State Administration of Taxation.


7. The term "completely consumed abroad" as mentioned in these Provisions means:

(1) The actual recipient of the service is outside the country and has nothing to do with the goods and real estate in the territory.

(2) The intangible assets are used completely outside the country and have nothing to do with the goods and real estate in the territory.

(3) Other circumstances as stipulated by the Ministry of Finance and the State Administration of Taxation.

8. The taxable activities of domestic units and individuals related to Hong Kong, Macao and Taiwan shall be implemented in accordance with the above provisions unless otherwise provided herein.

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