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	NOTICE OF THE GENERAL ADMINISTRATION OF CUSTOMS ON THE IMPLEMENTATION OF THE GUIDING CATALOG OF INDUSTRIES FOR FOREIGN INVESTMENTS (TAX EXEMPTION FOR CERTAIN IMPORTED ITEMS)

	(No.81[2002] of the General Administration of Customs promulgated on April 4, 2002)


SUBJECT : IMPORT; EXEMPTION
ISSUING DEPARTMENT : GENERAL ADMINISTRATION OF CUSTOMS OF THE PEOPLE'S REPUBLIC OF CHINA
ISSUE DATE : 04/04/2002
IMPLEMENT DATE : 04/01/2002
LENGTH : 637 words
TEXT :

Upon the approval of the State Council, the State Development Planning Commission, the State Economic and Trade Commission and the Ministry of Foreign Trade and Economic Cooperation have jointly promulgated, by Order No.21, the new Catalog for the Guidance of Industries for Foreign Investment (hereinafter referred to the Catalog, see attachment 1), which was put into implementation on April 1, 2002. We hereby printed and distribute it to you, and the relevant issues concerning the implementation of the Urgent Notice on Carrying out the Notice of the State Council on Adjusting the Tax Policies for Imported Equipment of the GAC (No.1062 [1997] of the General Administration of Customs) (hereinafter referred to the Notice) are notified as follows:

I. The Catalog shall be implemented from April 1, 2002, that is, all the foreign-funded projects (including projects of capital increase) approved after April 1 (the date of reply to the feasibility study report of a project shall be taken as the basis) shall be carried out in accordance with the Catalog. With respect to the encouraged foreign-funded projects with technology assignment, the self-used equipment imported within the total amount of investment, excluding the commodities listed in the Catalog of Imported Commodities of Foreign-funded Projects Not Exempted From Taxes, may be exempted from the customs duties and the import value-added tax pursuant to the Notice.

II. In order to keep the consistency of the policies, the encouraged and the restricted type B foreign projects approved prior to April 1, 2002 according to the former Catalog for the Guidance of Industries for Foreign Investment may continue enjoying the preferential tax policies pursuant to the Notice.

III. With respect to the projects that may enjoy the preferential import tax policies upon the approval of the department of examination and approval, the customs shall strictly examine and verify the range of the commodities exempted from taxes with reference to the Catalog of Imported Commodities of Foreign-funded Projects Not Exempted From Taxes.

Imported ships (including special ships) and airplanes shall not be exempted from taxes generally, but under special circumstances, exemption may be submitted to the GAC, which shall make examination and approval jointly with the relevant departments. The imported ships and airplanes of domestic-funded projects shall be dealt with pursuant to this Notice also.

IV. After the implementation of the Catalog, the code of the "Items of Industrial Policies Examination and Approval" in the project confirmation letter shall be "F", for instance, Item (1) of the first category shall be filled in as: Reform of Low-and Middle-Yielding Farmlands (F0101); Item 1) of Article 1 of the third category shall be filled in as: Storage and Processing of Food, Vegetables, Fruits, Fowls and Livestock (F030101).

The adjustment of the parameter database of the Management System of Tax Reduction and Exemption shall be notified separately.

V. The range of the commodity tax numbers in the Catalog of Imported Commodities of Foreign-funded Projects Not Exempted From Taxes has been adjusted pursuant to the Customs Import and Export Tariff of 2002, and is hereby distributed to you also (see attachment 2). If the aforesaid commodity tax numbers are adjusted due to the adjustment of tariff items, the adjusted tax number shall be taken for sure.

VI. Other issues not covered in this Notice shall be dealt with pursuant to the Notice of the State Council on Adjusting the Tax Policies for Imported Equipment (No.37 [1997] of the State Council) and the Notice.

Attachments:
1. Order No. 21 of the State Development Planning Commission of the People's Republic of China, the State Economic and Trade Commission of the People's Republic of China and the Ministry of Foreign Trade and Economic Cooperation of the People's Republic of China (omitted)
2. Catalog of Imported Commodities of Foreign-funded Projects Not Exempted From Taxes (corresponding to the tariff catalog of 2002) (omitted)