1989 - 2018 29 years in business Monday, 10th December 2018

IMF Calls For Single VAT Rate in China


Dear Clients, 

 

The International Monetary Fund has recommended that China introduce a single rate

Of Value added tax, during recent talks on the rapid progress China is making on fiscal

Reform.

 

The IMF said China is continuing to make progress on extending the value added tax to

A broader range of services, as part of its plans to replace the business tax with VAT.

Authorities plan to finish the implementation of the VAT by the end of the year, by introducing

VAT on the financial services industry.

 

Railway transportation services, postal services, and telecom services sectors were added to

The VAT base in 2014, As a result of the transition from business tax to VAT, businesses have saved

Some CNY191.8bn ( USD30bn).

 

The IMF said that minimizing the number of VAT rates, ideally to a single rate – would have

Significant administrative benefits. It said the policy objectives of having multiple rates could be more

Efficiently achieved with other fiscal instruments.

 

Discussing recent tax policy changes, the IMF welcomed recent increases to tax on petrol and ongoing

Natural resource tax reforms, It said that these measures will promote more environment-friendly growth.

The IMF concluded that the national rollout of a property tax, by 2017, will provide an important source

of local government  revenue.

 

Should you require any further clarification, please do not hesitate to contact us at:

info@cardwell-capital.com

 

Kind regards

Cardwell Advisory Desk
 

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