Circular of the Ministry of Finance and the State Administration of Taxation on Releasing the Interim Measures for the Collection and Administration of Cultural Undertakings Development Tax

Circular of the Ministry of Finance and the State Administration of Taxation on Releasing the Interim Measures for the Collection and Administration of Cultural Undertakings Development Tax

Cai Shui Zi [1997] No. 95

July 7, 1997

The Finance Departments (Bureaus), State Administration of Taxation Offices and Local Taxation Bureaus of all provinces, autonomous regions, municipalities directly under the Central Government and cities specifically designated in State planning,

For the purpose of effectively promoting the development of the socialist cultural and undertakings of China, the Interim Measures for the Collection and Administration of Cultural Undertakings Development Tax jointly drafted by the Ministry of Finance and the State Administration of Taxation has been approved by the State Council on June 17, 1997, which is hereby released and shall be implemented accordingly.

Appendix:
Interim Measures for the Collection and Administration of Cultural Undertakings Development Tax

Article 1 These Measures are formulated for the purpose of regulating the collection and administration of cultural undertakings development tax and promoting the healthy development of the socialist cultural undertakings of China.

Article 2 Entities and individuals within the territory of the People's Republic of China that pay the entertainment and advertising business tax in accordance with the Interim Regulations of the People's Republic of China on Business Tax shall be payers of the cultural undertakings development tax (hereinafter, the payers) and shall pay such tax in accordance with these Measures.

Article 3 The rate of the cultural undertakings development tax shall be 3%.
The rate of the cultural undertakings development tax shall be subject to adjustment by the State Council of the People's Republic of China.

Article 4 The amount payable by the payers shall be calculated on the basis of the business turnover of the payers subject to the entertainment and advertising business tax and the tax rate prescribed herein.
The calculation formula:
Amount of tax payable = the amount of business turnover subject to entertainment and advertising business tax * 3%

Article 5 The cultural undertakings development tax shall be collected by competent local taxation bureaus along with the entertainment and advertising business tax.

Article 6 The obligation to pay the cultural undertakings development tax shall arise on the date when the payer receives the taxable income or obtains the certificate of such taxable income.

Article 7 The time of payment of the cultural undertakings development tax is identical with that of the business tax paid by the payers; such time of payment may also be decided by the competent taxation authorities on the basis of the amount payable by the payer.

Article 8 The payers shall pay the cultural undertakings development tax to the competent taxation authorities in charge of the regions where the entertainment and advertising services that the payers provide occur.

Article 9 The cultural undertakings development tax collected on entities directly under the Central authorities as well as those enterprises and institutions under such entities shall be transferred to the Central treasury in full amount; the cultural undertakings development tax collected local entities and individuals shall be transferred to local provincial-level treasuries in full amount.

Article 10 The cultural undertakings development tax collected shall be placed under government financial and budgetary management.
　　......