INFORMATION OF GENERAL INTERESTS ON ENTERPRISE TAXES

State Administration of Taxation

The State Administration of Taxation (SAT) is the highest tax authority in China. The SAT is the ministry-level department directly under the State Council which is the functional department in charge of the State revenue work. Its mandates are mainly the followings:

(1) Drafting the relevant tax laws, regulations and the detailed rules for the implementation thereof; putting forward suggestions on tax policy and submitting it to the State Council together with the Ministry of Finance, and formulating the implementation procedures;

(2) Being involved in studying macro-economic policy and division of tax power between the Central and local governments; studying the overall level of tax incidence and proceeding with suggestions on how to regulate and control the macro-economy by means of taxation; formulating, and monitoring the implementation of, the rules and procedures of taxation work; supervising local tax administration and collection;

(3) Organizing and carrying out tax administration system reform; formulating tax administration procedures; monitoring the implementation of tax laws, regulations and tax policy;

(4) Organizing and executing the collection and administration of Central taxes, shared taxes, Agriculture Tax and contributions to funds designated by the State; preparing revenue plan; providing interpretation for any administrative and general tax policy issues arising in implementation of tax laws; handling matters of tax exemptions and reductions;

(5) Promoting international exchange and cooperation in the field of taxation; participating in international tax conventions, initialing and executing relevant treaties and agreements;

(6) Dealing with collection and refund of VAT and/or Consumption Tax on importation and exportation;

(7) Managing personnel, salaries, size and expenditure for all SAT offices across the country; being in charge of directors and deputy directors, and staff at similar level, of SAT offices at provincial level; providing comments on appointment or removal of directors of provincial local tax bureaus;

(8) Being in charge of education, training and ideological education for taxstaff in China; and

(9) Organizing tax propaganda activities and tax theoretical research; administering registered tax agents; and standardizing tax agency services. The Commissioner and four Deputy Commissioners of SAT are appointed by the State Council. One Chief Economist and one Chief Accountant are also members of the top leadership of the SAT. There are 14 functional departments within the Headquarters of SAT, each of which consists of several divisions (offices) as follows:

(a) General Office: consisting of Division of Secretaries, Secretariat Division, Supervisory Division, Comprehensive Research Division, News Division and Financial Division;

(b) Policy and Legislation Department: consisting of Division of Comprehensive Affairs, Tax Reform Division, Legislative Division and Appeal Division;

(c) Turnover Tax Department ( in charge of the administration of VAT, Consumption Tax and Business Tax): consisting of Comprehensive Division, VAT Division, Consumption Tax Division and Business Tax Division;

(d) Income tax Administration Department (in charge of administration of Enterprise Income Tax and Individual Income Tax): consisting of Comprehensive Division, Central Enterprise Income Tax Division, Local Enterprise Income Tax Division and Individual Income Tax Division;

(e) Local Tax Department (in charge of administration of Resource Tax, City and Township Land Use Tax, City Maintenance and Construction Tax, Fixed Assets Investment Orientation Regulation Tax, Land Appreciation Tax, House Property Tax, Vehicle and Vessel Usage Tax, Stamp Tax, Slaughter Tax and Banquet Tax): consisting of Comprehensive Division, Local Tax Division I, Local Tax Division II and Local Tax Division III;

(f) Agriculture Tax Bureau (in charge of administration of Agriculture Tax, Animal Husbandry Tax, Deed Tax and Farmland Occupation Tax): consisting of Comprehensive Division, Agriculture Tax Division I and Agriculture Tax II;

(g) International Taxation Department (Offshore Oil Tax Bureau): consisting of Comprehensive Tax Policy Division, Tax Administration Division, Anti-Tax Avoidance Division, Offshore Oil Tax Division, International Tax Treaty Division, Foreign Affairs Division and Foreign Cooperative Division;

(h) Import and Export Tax Department ( responsible for VAT and Consumption Tax on importation and exportation ): consisting of Comprehensive Division, Import Tax Division and Export Tax Division;

(i) Administration and Collection Department: consisting of Comprehensive Division, Tax Propaganda Division, Invoice Management Division and Open Market Tax Division;

(j) Tax Investigation Department: consisting of Comprehensive Division, Procedure Division, Investigation Division I and Investigation Division II;

(k) Financial Management Department: consisting of Funding Division, Infrastructure Division and Equipment Division;

(l) Planning and Statistical Department: consisting of Comprehensive Division, Planning Division, Statistical Division and Macro-Analysis Division;

(m) Personnel Department: consisting of Comprehensive Division Personnel Division for Headquarters, Personnel Division for Local Offices, Recruit Division and Grass-root Work Division; and

(n) Supervision Bureau (representative office of Supervision Ministry):consisting of Secretariat Division, Discipline Inspection and Supervision Division and Division for Letters of Complaints.

Besides, some non-governmental institutions directly under the Headquarters of SAT are Education Center, Logistical Service Center, Information Technology Center, Registered Tax Agent Management Center, Tax Science Research Institute, China Taxation Magazine, China Taxation Newspaper, China Taxation Press, Yangzhou Training Center and Changchun Tax College.