Announcement of the State Administration of Taxation on Matters Concerning Tax Evaluation
Announcement of the State Administration of Taxation
no. 8 of 2018
Following the continuous development of the tax credit system, the social value and social influence of tax credit are increasing day after day, becoming an important asset for taxpayers to participate in market competition. In order to further implement the spirit of the State Council ‘devolution” reform, optimize the environment of tax business, encourage “public entrepreneurship and innovation”, the following matters concerning further improving tax evaluation are hereby announced according to the Law of the People’s Republic of China on Tax Collection and the Notice of the State Council Issuing the Planning Outline on the Construction of a Social Credit System (2014-2020) (State Council Document no. 21 :
1. The following enterprises are added to participate in tax credit evaluation:
(1) enterprises that have been dissatisfied with one annual evaluation from the date when they first handled tax-related matters (hereinafter referred to as “newly added enterprises”). The evaluation year refers to a solar year, from 1 January to 31 December;
(2) enterprises that during the evaluation year have had no production or operations;
(3) enterprises using the income tax approval method of tax collection.
2. The tax evaluation deadlines for companies listed under article 1 of the Present Announcement are as follows:
(1) Where newly added enterprises have handled tax matters before 1 April 2018, tax authorities shall evaluate their tax credit before 30 April 2018. Starting from 1 April 2018, tax authorities shall promptly conduct the tax evaluation of newly added enterprises handling tax matters for the first time;
(2) concerning enterprises that during the evaluation year have had no production or operations, and enterprises using the income tax approval method of tax collection, tax authorities shall conduct the tax evaluation after the end of the evaluation year, according to provisions of the “Temporary Measures on Managing Tax Credit” (State Administration of Taxation Announcement no. 40 of 2014) [hereinafter referred to as Measures on Managing Credit];
3. The tax credit rating level of M is added, with the four tax rating levels of A, B, C, D changing to the five levels of A, B, M, C, D. The tax rating level of M is applicable to the following enterprises where the breaches of trust under article 20 of the Measures on Managing Credit have not occurred:
(1) newly added enterprises;
(2) enterprises that during the evaluation year have had no production or operations, and obtained an annual evaluation index of 70 points or more.
4. Tax institutions shall adopt the following incentive measures on enterprises with a tax credit rating of M:
(1) cancelling the VAT invoice certification;
(2) providing timely guidance on tax policies and tax management.
5. Where breaches of trust listed under article 22 of the Measures on Managing Credit occur in an enterprise (newly added enterprises included), tax institutions shall promptly adjust their tax credit rating, and inform them of such adjustment, as well as announce the downgrading through appropriate means.
6. Except as provided above, other matters concerning tax evaluation shall be regulated by provisions in the Measures on Managing Credit.
7. The Present Announcement shall enter into force on 1 April 2018. Article 17 paragraph 2 of the Measures on Managing Credit shall at the same time be repealed.
So it is hereby announced.
State Administration of Taxation
1 February 2018