04 Oct 2012
Business tax and VAT (Value Added Tax) are major tax categories in China with tax rates varying from 3% to 15% depending on the sector of activity. A tax reform in China is gradually replacing turnover tax with VAT to lower overall tax burdens and boost certain sectors such as transport and modern services. The government has recently stipulated that the scope of the VAT pilot project will be expanded from Shanghai to Beijing, Tianjin, Xiamen and Shenzhen, as well as the provinces of Jiangsu, Zhejiang, Anhui, Fujian, Hubei and Guangdong, by the end of 2012. More areas will be added next year and the pilot project will be extended to other sectors throughout the country.