According to the Provisional Regulations of People's Republic of China (PRC) on Value-added Tax, loans are loans, not income, and there is no need to pay value-added tax, but only when there is new value. In addition, the lender shall pay stamp duty on the loan amount in the loan agreement.
Value-added tax is a turnover tax based on the value-added amount of goods (including taxable services) generated in the circulation process. From the taxation principle, value-added tax is a kind of turnover tax levied on the added value of many links such as commodity production, circulation and labor services or the added value of commodities. Extra-price taxation is implemented, that is, it is borne by consumers, and it is taxed only if there is value added, and it is not taxed if there is no value added.
Extended data
There are 10 contracts in the stamp duty tax items and rates table. They are:
(1) purchase and sale contract.
② Processing contract.
(3) contracts for survey and design of construction projects.
(4) Construction and installation project contract.
(5) Property lease contracts.
(6) Contract of carriage of goods
(7) warehousing contracts.
(8) loan contract.
(9) Property insurance contracts.
(10) technical contract
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