Laws of the People's Republic of China

Circular of the Ministry of Finance and the State Administration of Taxation on Continuing the Value-added Tax Relief Policy on Goods Sold by National Trade Enterprises and For-border-sale Tea Produced by State Designated Enterprises and Sold by Selling Units

Cai Shui [2006] No.103

The public finance departments (bureaus) and the state taxation bureaus of all provinces, autonomous regions, municipalities directly under the central government and cities specially designated in the state plan, and the Public Finance Bureau of the Xinjiang Production and Construction Corps:

Upon the approval of the State Council, the following is the circular on the Value-added Tax on goods sold by national trade enterprises and the sold-on-border tea produced by state designated enterprises and sold by selling units:

1.

As from January 1 , 2006 to December 31 , 2008, goods (except oil and tobacco) sold by national trade enterprises and supply and marketing co-operatives at or below the county level in national trade counties shall be exempted from value-added tax.

2.

As From January 1 , 2006 to December 31 , 2008, for-border-sale tea produced by state designated enterprises and sold by selling units shall be exempted from value-added tax.

3.

During the implementation of the policy, if the State readjusts and identifies national trade counties and state designated enterprises engaging in for-border-sale tea production, then the policy shall be enforced within the readjusted counties and enterprises.

4.

Circular of the Ministry of Finance and the State Administration of Taxation on Continuing the Value-added Tax Relief Policy on National Trade Enterprises (Cai Shui [2001] No.69) and Circular of the Ministry of Finance and the State Administration of Taxation on Continuing Exempting For-border-sale Tea Produced by State Designated Enterprises and Sold by Selling Units from Value-added Taxation (Cai Shui [2001] No.71) shall be abolished simultaneously.

Ministry of Finance

State Administration of Taxation

August 7, 2006