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China Issues Regulations on Foreign Labor Service Cooperation
In order to regulate foreign labor service cooperation and legitimatize laborers’ rights, China’s State Council approved the “Administrative Regulations on Foreign Labor Service Cooperation ([2012] No. 620, hereinafter referred as the ‘Regulations’)” on May 16. The Regulations will come into effect on August 1, 2012.
China Clarifies Use of Special VAT Invoices for Export Tax Refunds
To clarify issues that occur when foreign-trade enterprises apply for export tax refunds using special value-added tax (VAT) invoices which have been approved as input VAT creditable, the State Administration of Taxation (SAT) promulgated the “Announcement on Issues Concerning Applying for Export Rebates by Foreign Trade Enterprises Using Special Value-added Tax Invoice (SAT Announcement [2012] No. 22, hereinafter referred to as ‘Announcement’).”
Nationality Row over Qualifications for China Lawyers
China’s Ministry of Justice is coming under the spotlight as are the roles of foreign lawyers in China following a case involving PRC-educated and qualified lawyer Stanley Cha, formerly of King & Wood, The Lawyer magazine has reported.
Foreign-Trade Enterprises Can Still Apply for Input VAT Credit Certificates
China’s State Administration of Taxation (SAT) issued an Announcement on May 25 extending the time for which an enterprise engaged in foreign trade (“foreign-trade enterprise”) can apply for a certificate claiming input VAT credit.
China Clarifies Individual Income Tax for Work-Related Injury Compensation
In order to fully implement the “Regulation on Work-Related Injury Insurances (Order of the State Council No.586, hereinafter referred as the ‘Regulation’),” the Chinese government issued the “Notice on Issues Regarding Individual Income Tax for Compensations of Work-Related Injury Insurances (caishui[2012] No.40, hereinafter referred as the ‘Notice’)” on May 3, 2012 in accordance with the income tax exempt items in Article 4 of Individual Income Tax Law of the People’s Republic of China.
China’s SAT Issues Opinion on International Taxation System
China’s State Administration of Taxation (SAT) recently issued the “Opinions on the Construction of the Administrative System of International Taxation (hereinafter referred as the ‘Opinion’),” specifying guidelines for service and management in such fields as anti-avoidance, taxation of non-residents, taxation issues facing Chinese enterprises investing abroad, and cooperation mechanisms for international taxation.
Shanghai Issues Guidelines on Wage Increases for 2012
In order to adjust to the economic development, rising CPI levels and changing dynamics of the current domestic job market, the Shanghai government issued the “Notice on the 2012 Guideline of Wage Increase for Shanghai Enterprises (hurenshezongfa[2012] No. 31)” on May 21, specifying the government’s suggested 2012 wage increases for enterprises in Shanghai.
IIT Calculation for Hong Kong and Macau Residents’ Mainland-Derived Income
In order to avoid ambiguities surrounding the double taxation of individuals working between Mainland China and the special administrative regions of Hong Kong and Macau, the State Administration of Taxation (SAT) issued the “Notice on Questions Regarding Tax Arrangements of Individual Employees Working in Both Mainland China and Hong Kong or Macau (SAT Notice [2012] No.16, hereinafter referred as ‘Notice’)” in April, clarifying the calculation of individual income tax (IIT) for related personnel.
China Minimum Wage Update
China’s Ministry of Human Resources and Social Security revealed the latest minimum wage levels across China in a press conference last month. The table below shows that most provinces and cities have set up minimum wage levels of more than RMB1,000.
Ten Cities and Provinces Apply to Participate in VAT Reform Pilot Scheme
At a conference with the China Certified Tax Agents Association, Deputy Director of the Department of Goods and Services Tax under the State Administration of Taxation, Long Yuehui, revealed that 10 cities and provinces have officially applied to participate in the value-added tax (VAT) reform pilot scheme so far, including Beijing, Chongqing, Shenzhen, Tianjin, Xiamen, Anhui Province, Fujian Province, Hainan Province, Hunan Province and Jiangsu Province.
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