Jiangsu Province Clarifies Tax Collection Standards

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Jun. 10 – Jiangsu’s Municipal Tax Bureau released the “Announcement on Tax Collection Standards (sudishuigui [2013] No.2, hereinafter referred to as the ‘Announcement’)” on May 31, which unifies the tax collection standards across the province. The Announcement includes eight types of tax collection rules, and clarifies the cost-profit ratios, tax rates of taxable income, and verified percentages in tax collection. Detailed information can be found below.

Cost-Profit Ratio

According to the Announcement, the cost-profit ratios as stipulated in Article 20 of the “Implementation Regulations for the Provisional Regulations of the People’s Republic of China on Business Tax” have been determined as the following:

  • Sales of immovable property: 15 percent
  • Other taxable activities: 5 percent

Such ratios will come into effect on July 1, 2013.

Tax Rate of Taxable Income

The tax rates of taxable income as stipulated in the Article 8 of the “Measures for Verification and Collection of Corporate Income Tax” have been determined as the following:

The tax rates of taxable income as stipulated in the Article 9 of the “Provisions on the Collection of Individual Income Tax on Investors in Sole Proprietorship Enterprises and Partnership Enterprises” have been determined as the following:

Jiangsu-Tax-Chart-2

Verified Percentage

The verified percentages as stipulated in the Article 4 of the “Circular on Issues Concerning the Reinforcement of Administration on Stamp Tax Collection” have been determined as the following:

Industrial Industry

  • Taxable certificate: Purchase and sales contracts
  • Determination of tax basis: Product sales revenue
  • Verified percentage: 80 percent

Commercial Industry

  • Taxable certificate: Purchase and sales contracts
  • Determination of tax basis: Product sales revenue
  • Verified percentage: 50 percent

Real Estate Development Industry

  • Taxable certificate: Documents on transferring of property rights
  • Determination of tax basis: Real estate business income
  • Verified percentage: 100 percent

Construction and Installation Industry

  • Taxable certificate: Contracts for construction and installation projects
  • Determination of tax basis: Settlement income of the projects
  • Verified percentage: 100 percent

Transportation Industry

  • Taxable certificate: Goods transportation contracts
  • Determination of tax basis: Settlement income of the projects
  • Verified percentage: 100 percent

Insurance Industry

  • Taxable certificate: Property insurance contracts
  • Determination of tax basis: Premium income
  • Verified percentage: 100 percent

Financial Industry

  • Taxable certificate: Loan contracts
  • Determination of tax basis: Loan amount
  • Verified percentage: 100 percent

The above-mentioned percentages will come into effect on July 1, 2013.

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