Notice on VAT (Value-Added Tax) in China

Notice on VAT (Value-Added Tax) in China

In accordance with the New Circular 37 of Cai Shui [2013] on “Tax Policy of VAT Pilot Program on Transportation & Modern Services Sector”, jointly issued by the Ministry of Finance (MOF) and the State Administration of Taxation (SAT) of PRC on 24th May 2013, the related VAT tax policy will be expanded nationwide with effect from 1st August 2013. This has a direct impact on the tax shown on freight invoices issued in China for exports and import related services.

In compliance with the above-mentioned policy, an additional 6% Value Added Tax (VAT) and other supplementary taxes related to the VAT, where applicable, will be levied on top of freight and charges payable in China.  This will be effective 1st August 2013 based on the issuance date of the VAT invoice.

All carriers are advertising they intend to apply on all charges that are preapaid.  Ie.  Local Chinese FOB charges and Ocean Freight if it is Freight prepaid.

Should the concerned authority make further changes to the requirement, we will inform you accordingly.

Should you require any further information, please do not hesitate to contact your Customer Service Manager.