China Law Online Database : novexcn.com

You are using Guest Account

Subscribe To This Law Only

Subscribe To All Law Contents

Print This Page

Back




	CIRCULAR OF THE MINISTRY OF FINANCE AND THE STATE ADMINISTRATION OF TAXATION ON THE RELEVANT POLICIES OF ENTERPRISES INCOME TAXES ON THE PURCHASE OF HOME-MADE EQUIPMENT BY FOREIGN FUNDED ENTERPRISES AND FOREIGN ENTERPRISES

	(No. 74 [2005] of the Ministry of Finance, July 20, 2005)


SUBJECT : CORPORATE TAX; INCOME TAX; FOREIGN FUNDED ENTERPRISES AND FOREIGN ENTERPRISES; PURCHASE OF HOME-MADE EQUIPMENT
ISSUING DEPARTMENT : MINISTRY OF FINANCE OF THE PEOPLE'S REPUBLIC OF CHINA, STATE ADMINISTRATION OF TAXATION
ISSUE DATE : 07/20/2005
IMPLEMENT DATE : 07/20/2005
LENGTH : 322 words
TEXT :

For the relevant polices of the deduction or exemption of the enterprise income taxes for the purchase of home-made equipment by foreign-funded enterprises and foreign enterprises and the policies of the refund of enterprise income taxes for re-investment by the relevant profits, we hereby notify as follows after deliberation:

I. According to the provisions of Article 9 of the Law of the People's Republic of China on the Income Taxes of Foreign Funded Enterprises and Foreign Enterprises, as for the deduction or exemption of the enterprise income taxes for the purchase of home-made equipment by foreign-funded enterprises and foreign enterprises, the tax amount as deducted or exempted shall be calculated according to the enterprise income taxes and the local income taxes as actually collected.

II. Where a foreign investor of a foreign-funded enterprise re-invests the profits got from his investment in China, and if the enterprise income tax amount as allowed to be deducted or exempted from the enterprise income tax of the foreign-funded enterprise as actually collected for the purchase of home-made equipment has already been deducted or exempted, the tax refund for re-investment shall be calculated in light of the actual burden as borne by the relevant enterprise. To be specific, the "original applicable enterprise income tax rate" and the "local income tax rate" in the formula of Article 82 of the Detailed Rules for Implementing the Law of the People's Republic of China on the Income Taxes of Foreign Funded Enterprises and Foreign Enterprises shall be decided according to the following formulas:

Original Applicable Enterprise Income Tax Rate = Enterprise income tax amount as actually paid by foreign-funded enterprises in the year of after-tax profits/Payable income tax amount of the foreign-funded enterprise in the year

Original Applicable Local Income Tax Rate = Local income tax amount as actually paid by the foreign-funded enterprise in the year of after-tax profits/Payable income tax amount of the foreign-funded enterprise in the year