China Unveils End-of-Period VAT Credit Refund Policy for Advanced Manufacturing Sector

According to an announcement jointly issued by the Ministry of Finance and the State Taxation Administration on 23 April (Announcement No. 15 [2021]), advanced manufacturing industry taxpayers are now entitled to apply to their local tax authority for a refund on overpaid input value-added tax (VAT) at the end of each taxable period.

Advanced manufacturing taxpayers will not be eligible for existing policies such as ‘refund upon payment’ and ‘return (refund) after payment’ after obtaining refunds under the new rule. For the purposes of these policies, ‘advanced manufacturing VAT taxpayers’ refers to any VAT taxpayers producing and offering for sale general equipment, special equipment, medicines, chemical fibres and other products with a sales value accounting for more than 50% of their total sales.

Source: Ministry of Finance