Laws of the People's Republic of China

Circular of the State Administration of Taxation on Pertinent Tax Policies for Export of Products with Gold Ingredients

Guo Shui Fa [2005] No.125

State taxation bureaus of various provinces, autonomous regions, municipalities directly under the Central Government and cities specifically designated in the state plan:

In order to further perfect tax policies for export of products with gold ingredients, after deliberation, it is hereby notified as follows:

1.

If an export enterprise exports products with gold ingredients (including gold and platinum), policies on exemption of value added tax shall be implemented, and corresponding amount of input tax shall no longer be refunded or credited but must be transferred to cost for handling. Products with gold ingredients which are entitled to enjoy free export policies have the following Customs commodity codes: 28431000, 2843300010, 2843300090, 28439000, 3824909030, 3824909090, 71110000, 71123090, 71129110, 71129120, 71129210, 71129220, 71129920,7 1129990, 71131911, 7113191910, 7113191990, 71131991, 7113199910, 7113199990, 7114190010, 7114190090, 7114200010, 7114200090, 71151000, 7115901020, 7115901090, 71159090 and so on.

2.

After having exported the aforesaid products containing gold, an export enterprise must, upon presentation of certificates required for export tax refund (exemption), apply to the tax refund department of any competent tax authority on a monthly basis for completing the Declaration of Tax Exemption Certificate for Exporting Products Containing Gold (See Appendix 1, it shall be made out in one pattern, two sheets; the first sheet shall be retained by any export enterprise itself and the second submitted to the tax refund department).

3.

The tax refund department under an tax authority shall, in addition to the Declaration of Tax Exemption Certificate for Exporting Products Containing Gold submitted by an export enterprise and required certificates, also examine pertinent electronic information through the examination system at the same time. After finding there is no mistake, the tax refund department shall issue a Certification of Tax Exemption for Exporting Products Containing Gold (Appendix 2, it shall be made out in one pattern, four sheets; the first sheet shall be retained by the tax refund department, the second submitted to the tax collection department, the third submitted by an export enterprise to the tax collection department for tax exemption declaration, and the fourth retained by the export enterprise), and the second sheet shall be submitted to the tax collection authority for handling tax exemption formalities.

4.

An export enterprise shall, upon presenting the Certification of Tax Exemption for Exporting Products Containing Gold (the third sheet) issued by the tax refund department, declare to the tax collection department for tax exemption. The tax collection department shall, after checking the tax exemption declaration made by the export enterprise with the Certification of Tax Exemption for Exporting Products Containing Gold (the second sheet) issued by the tax refund department, and finding no conformity between them, deal with tax exemption formalities. The export enterprise shall be required to transfer the input tax amount corresponding to goods exported free of duty to enterprise cost.

5.

In case of failing to declare to the competent taxation authority the products containing gold which are exported free of duty, within a specified period, an export enterprise must, in accordance with pertinent provisions of the Circular of the State Administration of Taxation on Several Issues Concerning the Administration of Tax Refund (Exemption) for Export of Goods (Guo Shui Fa [2004] No.64), and the Circular of the State Administration of Taxation on Several Issues Concerning the Failure to Declare Tax Refund (Exemption) of Exported Goods within the Prescribed Period (Guo Shui Fa [2005] No.68) provide output tax amount.

Tax authorities of all localities shall strengthen the connection between the tax imposition and tax refund, intensify responsibilities, establish and perfect work system as well as the administrative measures for communication and negotiation with the tax refund department, pay attention to the trends of exporting products containing gold and timely report to the State Administration of Taxation (Import and Export Tax Department) if finding enterprises export products containing gold which don¨t bear the aforementioned Customs commodity codes; products bearing such Customs commodity codes contain no ingredients of gold and platinum; and finding other problems during the implementation of tax exemption policies.

This Circular shall come into effect as of May 1, 2005. The specific date of implementation shall be subject to the date of export indicated on the goods declaration for exportation (special for export tax refund). Article 3 of the Circular of the Ministry of Finance and the State Administration of Taxation on Several Issues Concerning Gold Tax Policies (Cai Shui Zi (2002) No. 142), which relates to tax refund of gold jewelry, and the Circular of the State Administration of Taxation on Identifying Policies Concerning Tax Refund (Exemption) for Exporting Products with Gold Ingredients (Guo Shui Fa (2005) No.59) shall be repealed as of May 1, 2005. Where products stated above are exported by an export enterprise before May 1, 2005, the tax authority of a place where the export enterprise is located shall allocate and transfer such products from their places of origin by sending a letter, refund (exempt) taxes levied upon products which are eliminated from suspicion of tax frauds, and shall not refund (exempt) taxes levied upon such products as unable to be eliminated from the same suspicion for the time being.

Appendix:

1.

Declaration of Tax Exemption Certificate for Exporting Products Containing Gold Applicable to Export Enterprises

2.

Certificate of Tax Exemption for Exporting Products Containing Gold Applicable to Export Enterprises

State Administration of Taxation

July 29, 2005

Appendix 1:

Declaration of Tax Exemption Certificate for Exporting Products Containing Gold Applicable to Export Enterprises

　　Customs code for enterprise:

　　Taxpayer's identification code             　     Taxable period (MM/YY):    　　　         Unit: yuan