July 24, 2014
China’s value-added tax (VAT) reform has so far resulted in a tax reduction of 267.9 billion yuan (43.56 billion U.S. dollars) for businesses, the State Administration of Taxation (SAT) said Thursday.
China’s VAT reform, which was implemented as part of China’s structural tax cuts, has included replacing turnover tax with a VAT in the transportation industry, railway transport, postal services, telecommunications and some service sectors.
VAT refers to a tax levied on the difference between a commodity’s price before taxes and its production cost. Turnover tax refers to a levy on a business’s gross revenues.
The widening VAT reform has helped ease tax burdens for over 96 percent of affected taxpayers, according to the administration.