China: VAT replaces business Tax - What does this mean?
LehmanBrown International Accountants, MSI's Chinese accounting member firm provides an insight into the new tax reforms which will have a profound impact on all businesses in China.
On 5th March, 2016, Premier Li Keqiang announced at the opening of the National People's Congress that the real estate and construction, financial services and insurance, and lifestyle services industries will all be subject to VAT with effect from the 1st May 2016 with the first tax filing in June. This signifies the completion of the B2V reform measures within this year. China's indirect tax system introduced in 1994 comprising of both VAT and BT will now become obsolete.
The completion of B2V reform is expected to bring in a series of changes on VAT policy and administration which will have a profound impact on all businesses in China.
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