China Regulatory Brief: New Rules for Non-Store Retailing, Better Tax Services in Guangdong FTZ

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China Releases Administrative Measures for Non-Store Retailing

On May 5, the Ministry of Commerce (MOFCOM) releases the “Administrative Measures for Non-Store Retailing,” which is currently seeking public opinions and comments. The Measures clarify that retailers that are engaged in non-store retailing, namely selling products via mail, television or internet, are required to submit their business licenses and relevant certificates to the online platforms (if applicable) for record-filing. Non-store retailers are not allowed to send marketing emails or text messages (including WeChat messages) to customers if they haven’t been given permission. Further, non-store retailers need to provide fapiao, invoices or receipt to customers.

Details on Preferential CIT Policies in Qianhai Zone Released

On April 29, the Shenzhen local tax bureau released the “Guide to Preferential Corporate Income Tax (CIT) Policies for Enterprises in Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone,” which took immediate effect. The Guide announces that eligible enterprises engaged in encouraged industries in the Qianhai zone may enjoy a reduced CIT rate of 15 percent. Certain enterprises need to submit the application form and complete record-filing procedures with the local tax bureau. More details of the encouraged industries in the Qianhai zone can be found in our previous article. Importantly, the tax policy has State Council approval.

Shenzhen to Provide Better Tax Services for Investors

To provide better tax services for taxpayers in the Guangdong Free Trade Zone (FTZ), the Shenzhen local tax bureau recently launched simplified tax filing and invoice purchasing procedures in Qianhai Shekou area. To avoid the hassle of purchasing the invoices from the tax authorities, taxpayers may now choose to purchase the invoices (or “fapiao” in Chinese) they need online. The tax bureau will then deliver the invoices purchased by the taxpayers directly to their companies. Further, taxpayers are allowed to use third-party payment platforms or mobile payment to pay tax via their overseas RMB bank accounts. All tax-relevant matters including export tax rebate and tax filing can be completed online. Hong Kong CPAs (Certified Public Accountants) who have completed record-filing procedures are permitted to become partners in accounting firms established in the Guangdong FTZ. They are also permitted to provide the “tax-relevant verification report” for enterprises in the FTZ.

Fabian Knopf, Senior Associate at Dezan Shira & Associates, comments, “The procedures allow a glimpse into the experimentation lab of China’s tax administration and what could soon be rolled out to other tax bureaus and decrease compliance cost for companies, no matter whether Chinese- or foreign-invested. Remember however that this is an experiment and until more companies can benefit from the seemingly more convenient procedures, they will have to be tested first.”

Related Link IconRELATED: Buying and Printing Fapiao

Online Lottery Sales Forbidden in China

On May 5, the Administration for Industry and Commerce (AIC) released a circular stating that enterprises are forbidden from using online trading platforms to sell lottery tickets. Enterprises that are engaged in online lottery sales may have their business license revoked. Meanwhile, administrative punishments imposed by the AIC will be publicized via the enterprise credit information disclosure system. Online platforms will be held liable for selling lottery tickets if they fail to clean up relevant lottery sales information on their websites.


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