Interim Provisions Of The People's Republic Of China On Fixed Assets Investment Direction Regulating Tax (from government website)

Interim Provisions Of The People's Republic Of China On Fixed Assets Investment Direction Regulating Tax (from government website)


Omitted

Interim Provisions Of The People's Republic Of China On Fixed Assets Investment Direction Regulating Tax

Order of the State Council [1991] No.82

April 16, 1991
 
Article 1 With a view to carrying out state industrial policies, controlling investment scope, guiding investment direction, regulating investment structure, strengthening key constructions, and promoting sustained, stable and coordinated development of national economy, the present Provisions are formulated.
 
Article 2 All units and individuals who are engaged in investment in fixed assets within the territory of the People's Republic of China are obligated taxpayers (hereinafter referred to as taxpayers) of fixed assets investment direction regulating tax (hereinafter abbreviated to FAID regulating tax) and shall pay FAID regulating tax in accordance with stipulations of the present Provisions.
 
Article 3 Different tax rates shall be applied to FAID regulating tax according to state industrial policy and economic scale of project. Fixed assets investment projects shall have applicable tax rates determined in the light of scale of project unit. Taxable items and tax rates shall be applied according to the FAID Regulating Tax Schedule of Tax able Items and Tax Rates attached to the present Provisions.
Fixed assets investment (except investment in replacements and technical innovations) that are not listed in the Schedule of Taxable Items and Tax Rates shall be subject to a tax rate of 15%.
Investment in replacements and technical innovations other than those listed within the category of 0% according to the Schedule of Taxable Items and Tax Rates shall be subject to a tax rate of 10%.
FAID Regulating Tax Schedule of Taxable Items and Tax Rates may be revised by the State Council when it so decides.
 
Article 4 Calculation of payable FAID regulating tax shall be based on actually realized amount of investment in a fixed assets investment project and in case of replacements and technical innovation projects the calculation shall be based on actually realized amount of investment in construction project.
 
Article 5 FAID regulating tax upon a fixed assets investment project shall be paid in a year's advance based on annual investment budget for each project unit. At the end of the year, tax accounts shall be squared on the basis of actually realized investment amount with excessive payment of tax refunded or tax due repaid. Upon completion of the whole project, the tax accounts shall be cleared on the basis of actually realized total investment amount with excessive payment of tax refunded or tax due repaid.
Any taxpayer who really has difficulty in fully paying in advance tax upon the whole year's budgeted investment may, subject to examination and approval of the tax authority, pay by installments the total amount by the end of September of the very year.
 
Article 6 When a taxpayer applies for approval of a fixed assets investment project the taxpayer shall make sure that payment for FAID regulating tax has been effectively arranged for. FAID regulating tax shall be included in total investment budget and covered by economic and financial assessment of the project. But tax payment may not be taken into account when payment for design, construction or other fees are charged.
 
Article 7 FAID regulating tax may not be reduced or exempted except otherwise prescribed by the State Council.
 
Article 8 FAID regulating tax shall be collected and administered by the tax authority. Taxpayers shall go through procedures of tax registration, tax authentication and tax declaration with the tax bureau of the locality where the project is sited.
 
Article 9 Collection of FAID regulating tax shall be brought under a source control mechanism that combines planned unified management with an investment license system as is detailed in the following:
1. Planning commissions or planning and economic commissions of different provinces, autonomous regions, municipalities under the direct leadership of the Central Government and of separate-planning municipalities shall get together written project programmes on fixed assets investments in respective locality and transmit to lower levels taxable items, tax rates and tax amount to be applied to different fixed assets investment projects subject to examination and decision of the tax authority at the same level.
2. Taxpayers shall go to the tax bureau of the locality where the project is sited to go through procedures of tax registration and declaration etc. before they begin injecting annual investment. Banks and other financial institutions shall transfer the amount of tax upon presentation of the special tax payment notice paper issued by the tax authority.
3. Planning commissions or planning and economic commissions shall issue the investment permit upon presentation of the receipt of tax payment. Banks and other financial institutions shall proceed with allotment of funds or loans to fixed assets investment projects upon presentation of the investment permit.
 
Article 10 Payment for FAID regulating tax shall be withheld and transferred by the Chinese People's Construction Bank, the China Industrial and Commercial Bank, the China Agricultural Bank, the Bank of China, the Transportation Bank and other financial institutions or relevant units.
 
Article 11 For fixed assets investment projects beyond planning, the taxpayers may, in addition to payment of tax at applicable tax rates, be imposed on by the tax authority a fine as much as less than five times amount of tax that should be paid. But fixed assets investments beyond planning that are listed within the category of 0% tax rate shall be handled by relevant planning departments according to correspondent stipulations.
Investments in capital construction conducted under the pretext of replacements and renovations projects shall be imposed upon double amount of tax payable according to taxable items and tax rates applied to capital construction investments. But capital construction investments that are listed within the category of 0% tax rate shall be handled by relevant planning departments according to corresponding stipulations.
 
Article 12 In case a taxpayer fails to pay tax according to the present Provisions, planning commissions or planning and economic commissions shall cancel establishment of the project if it is at preparatory stage, or shall with hold arrangement for construction of the project if it has just been ready for construction, or shall cancel the annual investment budget if it is at the stage of continued construction and, additionally, shall revoke the investment permit. Banks and other financial institutions shall withhold from loaning or allotting funds to such project.
In case planning departments or banks violate the present Provisions to the consequence of tax evasion, relevant authorities at higher level shall investigate into responsibilities of concerned offenders.
 
Article 13 Other matters over management of collection of FAID regulating tax shall be handled according to stipulations of the Interim Provisions of the People's Republic of China on Management of Tax Collection.
 
Article 14 The present Provisions are not applicable to investments in fixed assets by Sino-foreign equity joint ventures, Sino-foreign cooperative enterprises or solely foreign funded enterprises.
The present Provisions are not applicable to investments in development items banned by the state. Such investments cases shall be separately handled by planning departments according to corresponding state laws, regulations, guidelines and policies.
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