{"id":4802,"date":"2014-01-01T11:45:33","date_gmt":"2014-01-01T10:45:33","guid":{"rendered":"http:\/\/www.ecovis.com\/focus-china\/?p=292"},"modified":"2021-09-06T15:01:26","modified_gmt":"2021-09-06T13:01:26","slug":"tax-in-china","status":"publish","type":"post","link":"https:\/\/www.ecovis.com\/focus-china\/tax-in-china\/","title":{"rendered":"Tax in China – Taxation in the PRC"},"content":{"rendered":"

By <\/i>Richard Hoffmann<\/a>, ECOVIS Beijing China<\/a><\/p>\n

Understanding the tax system in China can be challenging. 25 common types of taxes are currently levied on either enterprises or individuals. Some are of common nature but several are only imposed on very specific goods or services.<\/p>\n

The table “Tax in China” below gives an overview over the most important taxes that apply when investing in China:<\/p>\n

Tax in China:<\/h3>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
Category Of Tax<\/strong><\/span><\/td>\nType Of Tax<\/strong><\/span><\/td>\nTax Rate<\/strong><\/span><\/td>\n<\/tr>\n
\n

Tax On Transaction<\/span><\/strong><\/span><\/h1>\n<\/td>\n

\n

Value-added tax (VAT)<\/span> <\/b><\/h3>\n

Is levied on all goods sales (except for real estate) and the services of processing, repairing and replacing<\/td>\n

17% on most goods, sales and some services, 13% on daily necessary goods, 11% transportation, 6% on these Services: R&D, IT, cultural and creative, certification and consulting, international transportation, VAT exemption possible, 0% possible; (Rates for General Taxpayer)<\/td>\n<\/tr>\n
\n

Consumption tax<\/b><\/span><\/h3>\n

Imposed on specific products such as tobacco, alcoholic drinks, jewellery, cosmetics, fireworks, gasoline, diesel oil,tires, motorcycles, automobiles and luxury articles<\/td>\n

Tax rate varies from 1% for certain cars up to 50% for certain kinds of tobacco<\/td>\n<\/tr>\n
\n

Business tax<\/span> <\/b><\/h3>\n

Is applied on some services and the service of selling real estate properties<\/td>\n

3%-20%<\/td>\n<\/tr>\n
\n

Tax On Income<\/span><\/h1>\n<\/td>\n

\n

Corporate income tax (CIT\/EIT)<\/b><\/span><\/h3>\n

Levied on a company\u2019s profits from production and business operations<\/td>\n

25%, 20%, 15%, 10%<\/td>\n<\/tr>\n
\n

Withholding income tax<\/b><\/span><\/h3>\n

Applies to income that is generated outside China<\/td>\n

5%-45% (progressive)<\/td>\n<\/tr>\n
\n

Individual Income tax (IIT)<\/b><\/span><\/h3>\n

Levied on base salary, incentive compensation, labour service fee,
\ncash allowances (food allowance, transportation allowance, per diem),contributions to overseas insurance scheme, etc.<\/td>\n

<\/td>\n<\/tr>\n
\n

Tax on resource<\/span><\/h1>\n<\/td>\n

\n

Resources tax<\/b><\/span><\/h3>\n

Imposed on the extraction of natural resources like natural gas, crude oil, coal, salt<\/td>\n

Varying (Measured in x RMB per ton\/qm)<\/td>\n<\/tr>\n
\n

Tax on property & property transactions<\/span><\/h1>\n<\/td>\n

\n

Land appreciation tax<\/b><\/span><\/h3>\n

Levied on gains from transfer and usage real rights of state \u2013 owned land and building on it such as real estate properties<\/td>\n

30-60%<\/td>\n<\/tr>\n
\n

House Duty<\/span> <\/b><\/h3>\n

Applied on owners of buildings<\/td>\n

1.2% of building residual value or 12% of the rental<\/td>\n<\/tr>\n
\n

Tax On Transaction<\/span><\/h1>\n<\/td>\n

\n

Vehicle and Vessel Usage License Plate Tax<\/span> <\/b><\/h3>\n

Levied on vehicle usage<\/td>\n

25%,20%,15%,10%<\/td>\n<\/tr>\n
\n

Stamp Duty<\/span> <\/b><\/h3>\n

Levied on \u201cspecified economic documents\u201d (mainly contracts)<\/td>\n

0.05% \u2013 0.1% on amount of payment, fees or receipts<\/td>\n<\/tr>\n
\n

Deed tax<\/b><\/span><\/h3>\n

Applied on transfers of buildings or land usage rights<\/td>\n

3%-5%<\/td>\n<\/tr>\n
\n

Customs duties<\/span><\/h1>\n<\/td>\n

\n

Customs duties <\/b><\/span><\/h3>\n

(Tariff) Imposed on imported and exported goods<\/td>\n

Big divergence, taxes depending on CIF (cost,
\ninsurance, freight), also depending on nature of
\nthe good and country of origin.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
\n

If you liked this article, feel free to follow our social media sites for future updates or subscribe to our newsletter<\/a><\/i><\/p>\n

Ecovis Beijing<\/a><\/p>\n

If you have further questions about IIT, VAT, any other tax, or in general about doing business in China, feel free to
\n\"tax<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

By Richard Hoffmann, ECOVIS Beijing China Understanding the tax system in China can be challenging. 25 common types of taxes are currently levied on either enterprises or individuals. Some are of common nature but several are only imposed on very specific goods or services.<\/p>\n","protected":false},"author":10,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[798,37,33],"tags":[127,60,297,32,105,298,106,299,300,103,108],"class_list":["post-4802","post","type-post","status-publish","format-standard","hentry","category-blog","category-miscellaneous","category-tax-policy","tag-beijing","tag-business-tax","tag-business-tax-china","tag-china","tag-cit","tag-corporate-income-tax-china","tag-iit","tag-tax","tag-tax-on-income-china","tag-vat","tag-withholding-tax"],"acf":[],"yoast_head":"\nTax in China - Taxation in the PRC ECOVIS Beijing tax advisors accountants auditors lawyers<\/title>\n<meta name=\"description\" content=\"Tax in China can be challenging. 25 of the common types of taxes that are levied on enterprises, individuals to give you a good overview over tax in China.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.ecovis.com\/focus-china\/tax-in-china\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Tax in China - 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