Change from Business Tax into VATIn case of divergence of interpretation, the Chinese text shall prevail.

Announcement of the State Administration of Taxation on Relevant Issues Concerning the Qualification Accreditation of the General Value-added Tax (VAT) Taxpayer under the Pilot Project of VAT-for-BT Reform

Document No.:Announcement No.75, 2013 of the State Administration of Taxation

Taxes:Change from Business Tax into VAT

Date of Promulgation:2014-01-01

IssueDepartment:State Administration of Taxation

Date of Implementatio:2013-12-16


For the purpose of ensuring the successful implementation of the pilot project of VAT-for-BT reform, the relevant issues on the qualification accreditation of the general VAT taxpayer for taxpayers who are included in the scope of pilot project of VAT-for-BT reform (hereinafter referred to as taxpayers of the pilot project) are hereby notified as follows:


I. Taxpayers of the pilot project shall go through the qualification accreditation for the general VAT taxpayer status in accordance with the provisions of this announcement.


II. Except for the circumstances as provided in Article III of this announcement, before the implementation of the pilot project of VAT-for-BT reform (hereinafter referred to as before the implementation of the pilot project), taxpayers of the pilot project whose annual sales amount of taxable services is more than RMB 5 million Yuan shall apply for going through the qualification accreditation of the general VAT taxpayer with the in-charge state taxation authorities (hereinafter referred to as the in-charge taxation authorities).


The annual sales amount of taxable services of taxpayers of the pilot project before the implementation of the pilot project shall be converted by the following formula: annual sales amount of taxable services = total amount of turnover of taxable services for no more than 12 consecutive months ÷ (1 +3%)


Taxpayers of the pilot project who are subject to the collection of business tax on a deducted base under the existing business tax provisions, the turnover of taxable services shall be calculated according to the turnover before deduction.


III. Taxpayers who simultaneously provide pilot taxable services and have general VAT taxpayer qualifications prior to the implementation of the pilot project do not need to apply for accreditation again. The in-charge taxation authorities shall issue a Notice on Tax Matters and send it to taxpayers for notification.


IV. Taxpayers of the pilot project with annual sales of less than CNY5 million before the implementation of the pilot project may apply with the in-charge taxation authorities for qualification accreditation as general VAT taxpayers provided that they meet the relevant requirements provided by law. 


V. Before the implementation of the pilot project pre-accreditation measures can be formulated by the provincial state taxation bureau for the qualification accreditation of the general VAT taxpayerunder the pilot project in accordance with this announcement and relevant provisions.


VI. After the implementation of the pilot project, the qualified taxpayers of the pilot project shall, in accordance with the Administrative Measures for the Qualification Accreditation of General Value-Added Tax Taxpayer” (Order No.22 of the State Administration of Taxation) and relevant provisions, conduct the qualification accreditation of the general VAT taxpayer. In accordance with the relevant provisions of VAT-for-BT reform, for taxpayers of the pilot project who are eligible for deduction based on differences when determining the sales amount, the annual sales amount of taxable services shall be calculated according to the sales amount before deduction.


VII. Taxpayers of the pilot project who are simultaneously engaged in sales of goods, provision of processing, repair and replacement services and taxable services shall separately calculate the sales amount of taxable goods and services and the sales amount of taxable services, and they are  separately subject to standards of qualification accreditation of general VAT taxpayer.


Units and individual businessmen who are simultaneously engaged in sales of goods, provision of processing, repair and replacement services and taxable services, yet do not often have taxable behaviors may choose to pay taxes as small-scale taxpayers.


VIII. Once the taxpayer have obtained the general VAT taxpayer qualifications, if they committed  VAT evasion, cheat for export tax refund, making false VAT withheld certificates and other illegal behaviors, the in-charge taxation authorities may subject them to a tax payment re-education program of not less than six months.


IX. The present announcement shall come into force on January 1, 2014. The “Announcement of the State Administration of Taxation on Relevant Matters Concerning Qualification Accreditation of General Taxpayers for the Pilot Project of VAT for Business Tax Reform in Shanghai” (Announcement No.65, 2011 of the State Administration of Taxation), the Announcement of the State Administration of Taxation on Relevant Issues Concerning the Qualification Accreditation for General VAT Taxpayers under the Pilot Project Reform of VAT for Business Tax in Transportation and Certain Modern Service Industries” (Announcement No.28, 2013 of the State Administration of Taxation), and the Announcement of the State Administration of Taxation on Relevant Issues Concerning the Qualification Accreditation for General VAT Taxpayers” (Announcement No.33, 2013 of the State Administration of Taxation) shall be abolished at the same time.


The announcement is hereby notified as above.


State Administration of Taxation

December 16, 2013


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