August 1, 2012

The Ministry of Finance and the State Administration of Taxation (SAT) of the People's Republic of China have jointly issued a tax circular, Notice of VAT and Consumption Tax Policies for the Export of Goods and Labor Services, and SAT has separately issued its Administrative Measures for VAT and Consumption Tax on the Export of Goods and Labor Services, giving further clarifications on the relevant requirements, scope, basis for tax calculation, rebate rate and deadline for submission of claims.

The documents extend the time limit for filing tax rebate claims. Originally enterprises must file their claims within 90 days after goods are declared for export in order to be eligible for tax rebate. Now they can file VAT tax rebate claims on goods exported in the current year during filing periods any time between the month following the month the goods are exported and April the following year.

The two documents have expanded the scope of tax rebate on goods purchased by manufacturing enterprises for export by adding to it "deemed self-manufactured goods relevant to the production and business activities of the enterprise”. Some export VAT rebate policies have also been modified. Export enterprises that have not filed their tax rebate claims within the stipulated period and those that have filed their claims but have not submitted all supporting documents to the tax authorities within the stipulated period will be denied tax rebate but the goods will be treated as domestic sale and exempted from VAT.