China Value Added Tax ( VAT )

by on 01 August 2013

China VAT Changes – effective 1st August 2013

Please be advised of the ” Notice on Carrying out the Pilot Practice of Levying Value Added Tax in lieu of Business Tax on the Transportation Industry and Some Modern Service Industries in China”.

( Circular Caishui [2013] 37) – issued by the China’s Ministry of Finance and the State Administration of Taxation on May 24th, 2013, which will come into effect on August 1st, 2013.

Business in China ( including Freight Forwarders) will be taxed VAT at a rate of 6%. In addition, the relevant tax policies for initial pilots which took effect January 1st,2013, will be repealed on August 1st, 2013, having a direct impact on the taxation of invoices for EXPORT and IMPORT related activities.


– a new tax of 6% on all prepaid freight charges in China after August 1st, 2013.

– the tax of 6% will apply on all airfreight and origin charges, including Fuel and War surcharges, if terms of House Bill are freight prepaid, your supplier / agent wil face increases of 6% VAT on airfreight and origin charges

– seafreight, prepaid ( CIF,CNF terms) – your supplier / agent will face increases of 6% VAT on oceanfreight and origin charges

– seafreight, collect ( FOB terms) – the 6% VAT will apply to any collect origin charges only

Please contact us for further information, as we suggest you discuss these charges with your suppliers immediately

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