Announcement No. 84 of the Ministry of Finance and State Taxation Administration, 2019
It is hereby announced that the relevant policies on rebate of incremental VAT retained for taxpayers in some advanced manufacturing industries, so as to further promote the high-quality development of manufacturing industry:
I. From June 1, 2019, advanced manufacturing taxpayers meeting the following conditions may apply to the competent tax authority for rebate of incremental VAT retained from July 2019 and thereafter:
1. Rebate of incremental VAT retained is more than zero;
2. The tax-paying credit rating is A or B;
3. There are no cases of defrauding the rebate of VAT retained and export rebates or falsely issuing the VAT special invoice within 36 months prior to the claim for tax rebate;
4. Taxpayers have not been punished twice or more by tax authorities for tax evasion within 36 months prior to the claim for tax rebate;
5. Taxpayers are not entitled to the policy of “immediate levy and rebate” and “levy first and return later” since April 1, 2019.
II. Taxpayers of some advanced manufacturing industries mentioned herein refer to the taxpayers who produce and sell non-metallic mineral products, general equipment, special equipment and computers, communications and other electronic equipment in accordance with Industrial Classification for National Economic Activities, with sales of more than 50% of the total sales volume.
The proportion of sales mentioned above shall be calculated and determined on the basis of the sales volume for 12 consecutive months before the taxpayer applies for tax rebate; if the business period before the application is more than 3 months but less than 12 months, it shall be calculated and determined on the basis of the sales volume of the actual business period.
III. The incremental VAT retained in the Announcement refers to the newly increased end-of-period VAT retained compared with that on March 31, 2019.
IV. The rebated incremental VAT retained allowed by the taxpayers of some advanced manufacturing industries for the current period shall be calculated according to the following formula:
Allowable rebated incremental VAT retained = incremental VAT retained x component ratio of VAT paid
The component ratio of VAT paid refers to the proportion of the VAT amount noted on the VAT special invoices deducted (including the uniform invoice for sales of tax-controlled motor vehicles), special VAT payment vouchers of customs import and tax payment vouchers to all VAT paid deducted in the same period from April 2019 to the previous tax period before the claim for tax rebate.
V. Other provisions concerning the application of some advanced manufacturing taxpayers for rebated incremental VAT retained shall be subject to the Announcement of the Ministry of Finance, State Taxation Administration and General Administration of Customs on Policies Related to the Deepening of VAT Reform (Announcement No. 39 of Ministry of Finance, State Taxation Administration and General Administration of Customs, 2019, hereinafter referred to as Announcement No. 39).
VI. Other taxpayers, except some advanced manufacturing taxpayers, shall continue to apply for rebate of incremental VAT retained in accordance with No. 39 Announcement.
VII. Taxpayers meeting the requirements of the Announcement No. 39 and the Announcement shall submit applications for tax rebate and rebate of VAT retained to their competent tax authorities. For those meeting the conditions for rebate VAT retained, the tax authorities, after completing the tax rebate audit, shall issue a tax revenue rebate letter and send it directly to the Treasury at the same level for rebate. The tax authorities shall send the tax rebate list to the financial departments at the same level on time. All departments shall strengthen cooperation and collaborate to ensure stable and orderly rebate VAT retained.
The Ministry of Finance and State Taxation Administration
August 31, 2019