Taxation Myth in China
Have you ever heard that in China the revenue from State Administration of Taxation belongs to the Central Government? And the income of Local Tax Bureau belongs to the Regional Government? In fact, the tax bureau is not the organisation to allocate the tax.
Taxes go to the Central Government:
- 100% of Excise Tax / Tariff and Stamp duty;
- 75% of Value-Added Tax
- 60% of Corporate Income Tax & Individual Income Tax
- 50% of Value-Added Tax in lieu of a Business Tax
Taxes go to the Regional Government:
- 50% of Value-Added Tax in lieu of a Business Tax
- 40% of Corporate Income Tax & Individual Income Tax
- 25% of Value-Added Tax
- 100% of Other taxes
Why do you need to know where your taxes go?
As a taxpayer, definitely you have to know where your taxes go. The Regional Government offers financial subsidies to attract investment. The calculation of financial subsidies is according to the tax revenue of Regional Government. So, as an investor, you better start your business with financial subsidies. The financial subsidy is a springboard to assist you to step into China Market.
For further information, please contact us.
You may want to read: CHINA TAXATION SYSTEM HIGHLIGHT FOR INVESTORS FROM OVERSEAS