VAT

As of 1 December this year, companies in the service sector are no longer obliged to pay business tax. Instead, however, all such businesses are now liable under an extended VAT regime, which covers any business entity / individual engaged in the sale of services, intangible assets or immovable properties. More

In line with its policy of VAT reform, including the abolition of business tax in selected service sectors and the streamlining of the relevant tax bands, the State Council has announced a new three-tier VAT regime. This has seen the previous four-tier system simplified into three (17%, 11% and 6%) as of 1 July this year, with the 13% tax rate scrapped entirely. More

China’s Ministry of Finance and State Administration of Taxation have jointly released a circular clarifying value-added Tax (VAT) policy on finance, real estate development and education services (Cai Shui No.140 [2016]). More

On 7 April 2016, the European Commission presented an Action Plan containing strategies on how to develop the current Value Added Tax (“VAT”) system in the EU. Hong Kong traders may like to know that the VAT system holds an important role in Europe’s Single Market, and was initially established to remove turnover taxes which distorted competition and hindered the free movement of goods. More