Amendment to the Bahrain-China double tax treaty
Bahrain and China have recently amended their 2002 double tax treaty (DTT) by a protocol signed on 16 September 2013. The protocol will enter into force on the 30th day after the exchange of ratification and will apply to income derived during the
See MoreChina-US: Third Bilateral Advance Pricing Agreement Signed
In September 2013, China’s State Administration of Taxation and the U.S. Internal Revenue Service reached an agreement in principle on their third bilateral advance pricing arrangement. China and the United States concluded their second bilateral
See MoreChina-Switzerland: Initialed tax treaty agreements
A new agreement had been signed between China and Switzerland for the avoidance of double taxation on 25 September 2013. The new treaty will replace the current agreement that was signed in 1990. The dividend withholding tax rate is reduced to 5%
See MoreChina: Draft regulations relating labour dispatch
Recently, the government of China issued draft regulations relating to provisions of Labour Dispatch. Labour dispatch arrangements are supplementary arrangements for provision of labour and can only apply in respect of temporary positions of six
See MoreChina: Tax breaks for solar manufacturers
Recently the Finance Ministry of China has announced that it intends to offer tax breaks to solar manufacturers since the industry is struggling to recover from both oversupply and diminished export demand. A short statement was posted on-line on
See MoreChina: Scope for 50% tax deduction on R&D expenses
The Ministry of Finance of China on 30 September 2013, released a circular which expands the criteria for enterprises to be eligible to claim the extra 50 percent tax deduction on expenses incurred from research and development. The super tax
See MoreChina: Clarifies VAT exempt services rules
Following the launch of the Chinese VAT pilot in 2012, the Chinese tax authorities released detailed guidance on September 2013 on the rules around the exemptions for VAT on export services. The services covered by the exemptions include transport
See MoreChina: New rules on entry, exit of foreign individuals
In China, with respect to the administration of the entry and exit of foreign individuals new rules and processes are to be applied. The new ordinance (“Ordinance on the Administration of Entry and Exit of Foreign Individuals in China.”) is
See MoreChina: Resident certificate procedure for tax arrangement with Hong Kong
There was an announcement by the State Administration of Taxation (SAT) of China. And it was announced that the tax authority of Mainland China can determine tax resident status of a business or entities operating in Hong Kong. In certain
See MoreChina: Exemptions from VAT for exported services
Recently China’s State Administration of Taxation issued guidance on the rules for value added tax (VAT) exemptions for exported services. The guidance provided by Announcement 52 of 13 September 2013, implements the VAT exemptions for exported
See MoreChina: OECD publishes working paper on China’s tax policy
An OECD working paper titled “Tax policy and tax reform in the People’s Republic of China” was published on 9 September 2013. The paper makes a comparison between OECD tax policies and those in China and looks at the ratio of tax to GDP and
See MoreChina: Consumption tax on more luxury goods
China is considering broadening the scope of its consumption taxes to cover more luxury goods. This announcement comes as Chinese consumers are set to make up a third of luxury consumption globally by 2015, up from 27 percent in 2012. China already
See MoreChina: Tax exemption for small and micro-sized enterprises
The Chinese Finance Ministry (MOF) and the State Administration of Taxation (SAT) have announced VAT and business tax exemptions for small-sized businesses on 29th July 2013 and the new measure has come into effect from 1st August 2013. This
See MoreChina signs agreement for mutual assistance in tax matters
China signed the Multilateral Convention on Mutual Administrative Assistance on 27 August 2013 in Tax Matters. The Convention provides a framework for cooperation between tax authorities to exchange tax information. The OECD and the G20 are
See MoreChina: Eligibility of software enterprises for corporate income tax incentives
To clarify the rules concerning software enterprises that are eligible for certain corporate income tax incentives, China’s State Administration of Taxation has issued guidance on the issues arising in qualifying for these incentives. According
See MoreChina: Introduction of VAT on transportation charges
In China freight charges are now subject to a 6 percent value-added tax (VAT) rate. The circular Cai Shui No. 37 (Circular 37/2013) repeals the initial VAT policies which were introduced in 1st January 2012. The change, outlined in Cai Shui No.
See MoreNew Tax Treaty between China and Netherlands
The People’s Republic of China and the Netherlands signed a new tax treaty on 31 March 2013, which is expected to replace the current tax treaty of 1987. Under the new treaty, a building site, or construction, assembly or installation project or
See MoreChina and Switzerland Free Trade Agreement signed
A bilateral free trade agreement was signed on 6 July 2013 between China and Switzerland in Beijing. It is expected to enter into effect in 2014. It contains provisions on the protection of intellectual property rights. In order to combat
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