According to the pilot scheme, the main tax arrangements for the reform pilot are as follows:
First, on the basis of the current standard VAT rate 17% and low VAT rate 13%, two low VAT rates 1 1% and 6% are added. The tax rate of 17% is applicable to tangible movable property rent, 1 1% is applicable to transportation and construction, and 6% is applicable to other modern service industries.
Second, transportation, construction, post and telecommunications, modern services, culture and sports, sales of real estate and transfer of intangible assets, in principle, the general tax method of value-added tax is applicable. In principle, the simple calculation method of value-added tax is applicable to finance, insurance and life service industry.
Third, the tax basis. In principle, the taxpayer's tax basis is all the income obtained from taxable transactions. For some industries with a large amount of funds collected, transferred or prepaid, the amount collected and prepaid can be reasonably deducted.
Fourth, the import and export of service trade. The import of service trade is subject to domestic value-added tax, and the export is subject to zero tax rate or tax exemption system.
For the transitional policy arrangements during the reform pilot period, the pilot program is clear:
First, the ownership of taxes. During the pilot period, the current financial system was basically stable, and the business tax revenue originally belonging to the pilot area was changed to the value-added tax revenue still belonging to the pilot area, and the tax was put into storage separately. The reduction of fiscal revenue generated by the pilot project shall be borne by the central and local governments respectively according to the current fiscal system.
Second, the transition of preferential tax policies. The original preferential business tax policies granted by the state to pilot industries can be continued, but those that can solve the problem of double taxation through reform will be cancelled. During the pilot period, appropriate transitional policies should be adopted according to specific conditions.
Third, cross-regional tax coordination. The location of the pilot taxpayer is the location of the institution, and the business tax paid in different places is allowed to be deducted when calculating and paying VAT. Non-pilot taxpayers engaged in business activities in the pilot areas shall continue to declare and pay business tax in accordance with the relevant provisions of the current business tax.
Fourth, the convergence of VAT deduction policies. The special VAT invoices obtained by the existing VAT taxpayers from the pilot taxpayers can be deducted from the input tax according to the current regulations.
The "Trial Measures" also clarify that the State Administration of Taxation is responsible for the collection and management of the change of business tax to value-added tax. State Taxation Administration of The People's Republic of China is responsible for formulating the Measures for the Reform of Pilot Collection and Management, expanding the VAT management information system and tax collection and management information system, designing and uniformly printing special VAT invoices for the cargo transportation industry, and comprehensively preparing and implementing relevant collection and management.