The VAT rate for tap water is 13%. General taxpayers who produce and sell tap water can calculate and pay value-added tax at a collection rate of 6% according to the simplified method, but the input tax cannot be deducted. General taxpayers who produce tap water can choose to calculate and pay VAT at the 13% rate, or they can choose to calculate and pay VAT according to the simplified method. However, the chosen method of calculating and paying VAT cannot be changed for at least 3 years.

Value-added tax is a turnover tax levied based on the added value generated during the circulation of goods (including taxable services) as the basis for tax calculation. In terms of tax calculation principles, value-added tax is a turnover tax levied on the added value of multiple links in the production, circulation, and labor services of goods or the added value of goods. Implement extra-price tax, that is, consumers will bear the burden. Taxes will only be levied if there is value-added, but no tax will be levied if there is no value-added.

Value-added tax is a tax levied on the value-added amount levied on units and individuals who sell goods or provide processing, repair and maintenance services, or import goods. Value-added tax has become one of the most important types of taxes in China. Value-added tax revenue accounts for more than 60% of China's total tax revenue, making it the largest tax type. Value-added tax is collected by the State Taxation Bureau. 50% of the tax revenue is central fiscal revenue and 50% is local revenue. The value-added tax on the import link is collected by the customs, and all tax revenue is central fiscal revenue.

In summary, although most general taxpayers choose the simple collection method and calculate and pay VAT at a 6% collection rate, the VAT rate applicable to tap water is still 13%.

Legal basis:

"Provisional Regulations of the People's Republic of China on Value-Added Tax"

Article 11

Small-scale When a taxpayer engages in taxable sales, a simple method is adopted to calculate the tax payable based on sales volume and collection rate, and input tax cannot be deducted.