INFORMATION OF GENERAL INTERESTS ON ENTERPRISE TAXES
Revenue Alloceation Between The Central Government And Local Governments
According to the rules of the State Council on revenue sharing
system, the tax revenue in China may divided into Central tax
revenue, local tax revenue and the tax revenue shared between
the Central and local governments.
(1) Central tax revenue: domestic Consumption Tax; Customs Duties;
VAT and Consumption Tax collected by the Customs on behalf.
(2) Local tax revenue: Individual Income Tax; City and Township
Land Use Tax; Farmland Occupation Tax; Fixed Assets Investment
Orientation Regulation Tax; Land Appreciation Tax; House Property
Tax; Urban Real Estate Tax; Inheritance Tax (not yet legislated);
Vehicle and Vessel Usage Tax; Vehicle and Vessel Usage License
Plate Tax; Deed Tax; Slaughter Tax; Banquet Tax; Agriculture
Tax and Animal Husbandry Tax and their local surtaxes.
Tax revenue shared between the Central and local governments:
a. Domestic VAT: 75% for Central Government and 25% for Local
Governments;
b. Business Tax: the part consolidatedly paid by the railway
department, the headquarters of various banks and the headquarters
of various insurance companies, and the additional 3% Business
Tax paid by financial and insurance enterprises Resource Tax
belong to the Central Government; and the rest is assigned to
the local governments;
c. Enterprise Income Tax: income tax paid by Central enterprises,
income tax paid by local banks and non-bank financial institutions,
and the part consolidatedly paid by the railway department,
the headquarters of various banks and the headquarters of various
insurance companies belong to the Central Government; and the
rest for local governments;
d. Income Tax on enterprises with foreign investment and foreign
enterprises: the income tax paid by foreign funded Banks belongs
to the Central Government, and others for local governments;
e. Resource Tax: the part for the Central Government is the
tax paid by offshore oil enterprises, and the rest is for the
local governments;
f. City Maintenance and Construction Tax: the part consolidatedly
paid by the railway department, the headquarters of various
banks and the headquarters of various insurance companies belong
to the Central Government; and the rest to the local governments;
g. Stamp Tax: 88% of the Stamp Tax revenue collected on stock
transactions for the Central Government; the remaining 12% for
the local governments; and
h. Security Exchange Tax (not yet legislated and levied).
Appendix
1: China's Current Tax System
China's Current Tax System
| Category of Taxes |
Type of Taxes |
| Turnover Taxes |
VAT |
| Consumption
Tax |
| Business Tax
|
| Income Taxes |
Enterprise
Income Tax |
| Income Tax
on Enterprises With Foreign Investment and Foreign Enterprise
|
| Individual
Income Tax |
| Resource Taxes |
Resource Tax
|
| Urban and Township
Land Use Tax |
| Special Purpose Taxes |
City Maintenance
and Construction Tax |
| Farmland Occupation
Tax |
| Fixed Assets
Investment Orientation Regulation Tax |
| Land Appreciation
Tax |
| Property Taxes |
House Property
Tax |
| City Real Estate
Tax |
| Inheritance
Tax |
| Behavioural Taxes |
Vehicle and
Vessel Usage Tax |
| Vehicle and
Vessel Usage Plate Tax |
| Stamp Tax |
| Deed Tax |
| Security Exchange
Tax |
| Slaughter Tax
|
| Banquet Tax
|
| Agriculture Taxes |
Agriculture
Tax |
| Animal Husbandry
Tax |
| Customs Duties |
Customs Duties
|
Notes:
1. Slaughter Tax, Banquet Tax and Animal Husbandry Tax are now
decentralised to the local governments for administration. Whether
levying or not shall be at the discretion of the governments
at provincial level for decision by taking into account the
local conditions.
2. Inheritance Tax and Security Exchange Tax have not yet legislated
to date. |
