With the tax reform gaining speed, new taxation policies will take effect this year, six of which concern the public the most, Xinhua reported on Jan 1.
Environmental Protection Tax
The Environmental Protection Tax of China went into force on Jan 1, levying a tax on all entities discharging contaminants. Revenue generated from the tax collection will be used to control pollution by governments at all levels.
“The start of this tax marked a milestone in the development of tax-aided environmental protection,” said Liu Shangxi, director of the Chinese Academy of Fiscal Sciences.
Value-added Tax
Product information managers will be subject to a 3-percent VAT based on their revenue as of Jan 1, which will act as leverage stabilizing the financial market and an element to take into account in launching and pricing financial products, said Li Xuhong, director of the Beijing National Accounting Institute.
Vehicle Purchase Tax
The 7.5-percent vehicle purchase tax rate will return to 10 percent for the purchase of vehicles with up to 1.6-liter engines. However, new energy vehicle buyers will continue to enjoy a non-tax status from Jan 1, 2018, to Dec 31, 2020.
“The withdrawal of the previous 7.5-percent tax rate comes down to environmental protection,” said Li.
Tariffs
The tariff restructuring heralds a decreased tariff rate for imports from 17.3 percent to 7.7 percent on average for imported food, medicine, clothing, and household appliances, as of Dec 1, 2017. Likewise, exports including steel and chlorite will be exempted from tariff collection as of Jan 1, 2018; apatite, coal tar, and other industrial raw materials will enjoy a lower export tariff rate.
Tariff restructuring demonstrates China’s unswerving resolve in promoting free global trade and confidence in international win-win cooperation, said Li.
Protection Tax on Water Resources
