Many New Tax Cut Measures Help Reduce the Burdens for Enterprises

The Semiconductor Division of Zhuzhou CRRC Times Electric Co., Ltd. received the tax refund with an amount of RMB 92.88 million in July. It took only four hours for this amount of money to go through the process from verification to refunding.

“The tax authorities’ persons left our company at about 10 a.m. after the related issues are checked. I didn’t expect that we could receive the tax refund at 2:30 p.m. The tax authorities were really efficient,” The company’s Deputy General Manager and Financial Director Zhang Hua said.

The refunding of reserved deductible VAT can directly boost an enterprise’s current cash flow, improve its operation condition, encourage its investment in scientific innovation and promote its sustainable development. According to the State Council’s arrangements, China has lowered the original VAT rate of 17% for manufacturing industry and 11% for building industry and transportation industry by 1 percentage point separately since May 1, 2018.

As the latest statistics issued by the State Administration of Taxation (SAT) on September 13 indicated, this tax cut policy started to show its positive effects since the tax declaration period in June. Specifically, the amount of tax cut from June to August totaled RMB 95.9 billion. What’s more, 18 enterprises from advanced manufacturing industry, modern service industry and power grid sector have started since July to refund the overpaid VAT. In two months including July and August, the tax authorities refunded the reserved deductible VAT with an amount of RMB 78.6 billion. The total tax cut was RMB 174.5 billion.

According to Wei Cong, a tax agent from Guangzhou Liuzhou Iron and Steel Group Co., Ltd., the group has been approved the tax collection rate of 16% and the tax rebate rate of 13% since May 1. In this way, the group will have the lower production and operation cost. Now the group has completed the export tax rebate (exemption) with a total amount of RMB 196.8 million, so the group can recover its capital in the shortest time possible.

The reporter learned from the SAT that, because of VAT cut policy, China’s VAT growth was 5.1%, 6.2% and 2.9% in June, July and August respectively, and tax revenue collected by the tax authorities (with the export tax rebate deducted) increased by 11.1%, 10% and 7.2% separately, thus revealing the growing tax-cut effects.

Meanwhile, the tax authorities has never ceased their efforts to deepen the reform of “delegation, regulation and service”, implement the export tax rebate policy on a full scale and handle the export tax rebate in a timely manner.

As the related data indicated, the national tax authorities completed the export tax rebate with a total amount of RMB 1.0052 trillion from January to August, up 9.5% YoY. In August, they completed the export tax rebate with an amount of RMB 119.8 billion, up 15.8% YoY, thus offering a vigorous support for the export in foreign trade sector.

In addition, the SAT and the Ministry of Finance (MOF) have recently issued the Circular on Increasing the Export Tax Rebate Rate of Mechanical & Electrical and Cultural Products as the past of the State Council’s plan. According to the Circular, 397 types of mechanical & electrical and cultural products will raise their VAT’s export tax rebate rate since September 15, 2018.

Only the well-targeted tax-cut measures can provide taxpayers with stronger sense of gain. Since this year, the tax authorities at all levels have worked harder to promote the implementation of relevant policies.

In Guangzhou, the export tax rebate work has become more efficient after the local tax authorities develop the online declaration platform for export tax rebate in the “single window” of international trade.

Guoguang Electric Company Ltd. is a world-class electric sound device manufacturer. Because the tax authorities publicized policies and adjusted system timely, the company declared the export value of RMB 220 million and completed the export tax rebate of about RMB 30 million according to the new tax rebate rate in August.

“It takes less than two days to complete tax rebate on average. Sometimes, the tax declaration happens on one day and the tax rebate is completed on the second day. In this way, it has earnestly helped the company recover its capital faster,” Li Huahai, the Manager from the company’s Financial Center said, “What’s more, the tax authorities can offer the doorstep service to listen to the company’s demands and suggestions.”

The SAT’s leader concerned said that the tax authorities will earnestly carry out the deployment of tax reduction decisions by the CPC Central Committee and the State Council, continuously carry out the tax reduction policy and constantly improve the taxation environment, enhance the convenience for taxpayers to enjoy the policy and strengthen their sense of gain, and boost the economic development and the people’s livelihood.

Source: Xinhua News Agency