(State Administration of Taxation: 2, November 1993 Guo Shui Fa[93] No. 117)

(State Administration of Taxation: 2, November 1993 Guo Shui Fa[93] No. 117) Whole Doc.

To the tax bureaus of various provinces, autonomous regions and municipalities and the tax bureaus of various cities with separate planning: The Stipulations of the State Administration of Taxation On Some Issues Concerning Implementation of the Law of Tax Collection and Management and Detailed Rules for Its Implementation are hereby printed and issued to you, please put them into practice in real earnest.

Appendix: Stipulations of the State Administration of Taxation On Some Issues Concerning Implementation of the Law of Tax Collection and Management and Detailed Rules for Its Implementation A duplicate is sent to: The Ministry of Finance STIPULATIONS OF THE STATE ADMINISTRATION OF TAXATION ON SOME IS- SUES CONCERNING IMPLEMENTATION OF THE LAW OF TAX COLLECTION AND MANA- GEMENT AND DETAILED RULES FOR ITS IMPLEMENTATION In order to ensure implementation of the Law of the People's Republic of China for Tax Collection and Management (hereinafter referred to as Law of Tax Collection and Management and the Detailed Rules for Implementation of the Law of the People's Republic of China for Tax Collection and Management, related questions are hereby stipulated as follows: I. Tax Registration In accordance with the stipulations of ARTICLE 5 of the Detailed Rules, tax payers who are not engaged in production and management, apart from temporarily gaining taxable income or having dutiable conducts as well as only paying personal income regulatory tax and personal income tax, and vehicle and vessel license tax, shall all, within 30 days from the day of approval granted by the department concerned or within 30 days from the day they become legal tax payers according to the stipulations of laws and administrative regulations, report to, and perform the procedures for tax registration, at tax authorities in accordance with the Law for Tax Collection and Management and the procedures and requirements stipulated in the Detailed Rules and shall be issued a tax registration certificate after examination and approval by tax authorities.

While performing the procedures for tax registration, the tax payer shall report to, and perform procedures at, the competent tax authorities in line with the scope of jurisdiction defined by the tax authorities in the location of his or her production and management. The tax authorities shall handle the matter for him or her within the specified time, and shall give a reply to those whose case does not fit the stipulations.

Tax registration certificates are classified into: Tax registration certificate and its duplicate and registered tax registration certificate and its duplicate. Tax payer who engages in production and management and who is issued a business license by the administrative department for industry and commerce shall be issued a tax registration certificate and its duplicate, but to the branch of the tax payer which is not engaged in independent accounting, as well as tax payer who shall perform the procedures for tax registration in line with the stipulations of Clause 1 of this article shall be issued a registered tax registration certificate and its duplicate.

After receiving the tax registration certificate, the tax payer shall engage in operation by putting up and display the certificate in the conspicuous, easily visible place of his or her production and operational site. Tax payer who engages in operation in another place shall bring with him or her their tax registration certificate or the duplicate of the registered tax registration certificate.

Tax authorities shall check the already issued tax registration certificate once a year and change it once every three years. The concrete time for checking the certificate shall be determined in a unified way by the tax bureaus of provinces, autonomous regions and municipalities and the time for changing the certificate shall be stipulated in a unified way by the State Administration of Taxation.

The category of tax registration certificate related to foreign countries and the time for checking and changing certificates shall be carried out temporarily in accordance with the Document Guo Shui Fa (1993) No. 021.

II. Postponement of Declaration The tax payer who is approved by tax authorities postponement of declaration of tax payment, except for irresistible reasons, shall, within the specified declaration period, pay tax in advance in accordance with the actually paid tax amount of the previous period or with the tax amount verified and fixed by tax authorities, and shall perform taxation settlement within the approved extended period.

III. Deferred Tax Payment In line with the stipulations of Clause 1 of ARTICLE 20 of the Law for Tax Collection and Management, tax payer who cannot pay tax on schedule due to special difficulty shall, within the specified tax paying period, present a written application to the competent tax authorities and can postpone paying tax only with approval from the tax bureau (sub-bureau) at or above the county level, but the longest time for deferred tax payment shall not exceed three months.

IV. Verifying and Fixing Tax Amount In line with the stipulations of ARTICLE 23 of the Law for Tax Collection and Management and ARTICLE 35 of the Detailed Rules, tax authorities may levy taxes by adopting the method of verifying and fixing the tax amount. Verifying and fixing tax amount means determining the dutiable tax amount of the tax payer's current or previous tax period. But for the tax payer who may not set up an account book in accordance with stipulations, tax authorities may verify and fix his next period dutiable tax amount, that is, levying tax by the method of fixed term and fixed amount.

V. Calculation of the Value of Detained and Sealed Up Commodities, Goods or Other Properties In accordance with the stipulations of ARTICLES 25, 26, and 27 of the Law for Tax Collection and Management, tax authorities, while carrying out detaining and sealing up, shall calculate the value of detained and sealed up commodities, goods or other properties according to the following methods: (1) While detaining and sealing up commodities and goods, tax authorities shall calculate their value in accordance with the lowest market purchasing prices at the given time and place.

(2) While detaining and sealing up valuable articles such as gold, silver and jewelry, tax authorities shall calculate their value in accordance with the purchasing price published by the special state institution.

(3) While detaining and sealing up immovable properties, tax authorities shall calculate the value in accordance with the value assessed by the local property evaluation organization.

While determining the quantity of the detained and sealed up commodities, goods or other properties in accordance with the above-mentioned method, tax authorities shall also include in them the expense occurred in the course of detaining, sealing up, keeping and auctioning.

VI. Calculating the Value of Tax Guaranteed Property In line with the stipulations of the Law for Tax Collection and Management, the tax payer may use the not mortgage property or entrust others with providing tax guarantee. While the tax payer or tax guarantor uses not mortgage property as tax guarantee, the value of the property shall be calculated in the method of conversion in line with the principle of the stipulations set in the previous ARTICLE.

VII. The Payment of Tax In line with the stipulations of the Law for Tax Collection and Management and its Detailed Rules, tax authorities may use the income gained from the selling of the detained, sealed up commodities, goods or other properties to pay tax and overdue fine. With regard to that portion of income that exceeds the dutiable tax, overdue fine and the expense on keeping and auctioning, tax authorities shall return the remaining money after deducting tax fine to the parties concerned; with regard to deficiency in paying tax and overdue fine, tax authorities shall recollect the money according to law.

VIII. Handling of Cases Regarding the Tax Payer Who Refuses to Accept Tax Withheld In line with the stipulations of Clause 2 of ARTICLE 19 of the Law for Tax Collection and Management, the withholding agent shall, within 24 hours, report to tax authorities about the case in which the tax paper refuses to accept tax withheld, tax authorities shall handle the case in line with the stipulations of the Law for Tax Collection and Management.

IX. Cancellation of Measures for Preservation of Tax In accordance with the stipulation of ARTICLES 25 and 26 of the Law for Tax Collection and Management, when the tax payer pays tax within the time limit set by tax authorities after measures for the preservation of tax are adopted by tax authorities, the tax authorities shall, within 24 hours after receiving the tax payments or the tax receipt sent back from the bank, cancel the preservation of tax.

X. Refund of Extra Tax Money In line with the stipulations of ARTICLE 30 of the Law for Tax Collection and Management, with regard to extra levied tax that should be returned to the tax payer, the tax authorities shall, within 60 days from discovering or receiving the tax payer's application for refunding, return the extra tax payment, or use the extra levied tax to pay the next dutiable tax in compliance with the tax payer's request.

XI. Management of Tax Reduction and Exemption In accordance with the stipulations of ARTICLE 21 of the Law of Tax Collection and Management, the tax payer who applies for tax reduction or exemption, shall submit a written report to the competent tax authorities and send related materials in line with regulations. The tax payer can enjoy tax reduction or exemption only after his application is examined and approved by tax authorities within the specified limit of power. After the expiration of the period of tax reduction or exemption, the tax payer shall resume paying tax from the day following the expiration of the period.

During the period of tax reduction or exemption, the tax payer shall submit a declaration on tax payment in line with the stipulations of Clause 1 of ARTICLE 16 of the Law for Tax Collection and Management, and send in a statistical report on tax reduction or exemption in accordance with the stipulations of tax authorities.

The tax payer shall use the tax money thus reduced or exempted in line with the stipulations of the tax authorities, with regard to those who do not use the money in accordance with the stipulated purposes, the tax authorities have the right to cancel the tax reduction or exemption granted to them and recover the already reduced and exempted tax.

When there are changes in the qualifications for enjoying tax reduction or exemption, the tax payer shall promptly report to the tax authorities who, after examination and verification, shall stop tax reduction and exemption; as regards those who fail to submit a report, the tax authorities have the right to recover the appropriate amount of already reduced or exempted tax.

The tax payer who gains tax reduction or exemption by cheating shall be punished without exception for tax evasion.

XII. These Regulations go into effect from the day of publication.

ution.

(3) While detaining and sealing up immovable properties, tax authorities shall calculate the value in accordance with the value assessed by the local property evaluation organization.

While determining the quantity of the detained and sealed up commodities, goods or other properties in accordance with the above-mentioned method, tax authorities shall also include in them the expense occurred in the course of detaining, sealing up, keeping and auctioning.

VI. Calculating the Value of Tax Guaranteed Property In line with the stipulations of the Law for Tax Collection and Management, the tax payer may use the not mortgage property or entrust others with providing tax guarantee. While the tax payer or tax guarantor uses not mortgage property as tax guarantee, the value of the property shall be calculated in the method of conversion in line with the principle of the stipulations set in the previous ARTICLE.

VII. The Payment of Tax In line with the stipulations of the Law for Tax Collection and Management and its Detailed Rules, tax authorities may use the income gained from the selling of the detained, sealed up commodities, goods or other properties to pay tax and overdue fine. With regard to that portion of income that exceeds the dutiable tax, overdue fine and the expense on keeping and auctioning, tax authorities shall return the remaining money after deducting tax fine to the parties concerned; with regard to deficiency in paying tax and overdue fine, tax authorities shall recollect the money according to law.

VIII. Handling of Cases Regarding the Tax Payer Who Refuses to Accept Tax Withheld In line with the stipulations of Clause 2 of ARTICLE 19 of the Law for Tax Collection and Management, the withholding agent shall, within 24 hours, report to tax authorities about the case in which the tax paper refuses to accept tax withheld, tax authorities shall handle the case in line with the stipulations of the Law for Tax Collection and Management.

IX. Cancellation of Measures for Preservation of Tax In accordance with the stipulation of ARTICLES 25 and 26 of the Law for Tax Collection and Management, when the tax payer pays tax within the time limit set by tax authorities after measures for the preservation of tax are adopted by tax authorities, the tax authorities shall, within 24 hours after receiving the tax payments or the tax receipt sent back from the bank, cancel the preservation of tax.

X. Refund of Extra Tax Money In line with the stipulations of ARTICLE 30 of the Law for Tax Collection and Management, with regard to extra levied tax that should be returned to the tax payer, the tax authorities shall, within 60 days from discovering or receiving the tax payer's application for refunding, return the extra tax payment, or use the extra levied tax to pay the next dutiable tax in compliance with the tax payer's request.

XI. Management of Tax Reduction and Exemption In accordance with the stipulations of ARTICLE 21 of the Law of Tax Collection and Management, the tax payer who applies for tax reduction or exemption, shall submit a written report to the competent tax authorities and send related materials in line with regulations. The tax payer can enjoy tax reduction or exemption only after his application is examined and approved by tax authorities within the specified limit of power. After the expiration of the period of tax reduction or exemption, the tax payer shall resume paying tax from the day following the expiration of the period.

During the period of tax reduction or exemption, the tax payer shall submit a declaration on tax payment in line with the stipulations of Clause 1 of ARTICLE 16 of the Law for Tax Collection and Management, and send in a statistical report on tax reduction or exemption in accordance with the stipulations of tax authorities.

The tax payer shall use the tax money thus reduced or exempted in line with the stipulations of the tax authorities, with regard to those who do not use the money in accordance with the stipulated purposes, the tax authorities have the right to cancel the tax reduction or exemption granted to them and recover the already reduced and exempted tax.

When there are changes in the qualifications for enjoying tax reduction or exemption, the tax payer shall promptly report to the tax authorities who, after examination and verification, shall stop tax reduction and exemption; as regards those who fail to submit a report, the tax authorities have the right to recover the appropriate amount of already reduced or exempted tax.

The tax payer who gains tax reduction or exemption by cheating shall be punished without exception for tax evasion.

XII. These Regulations go into effect from the day of publication.