Laws of the People's Republic of China

State Administration of Taxation

Circular of the State Administration of Taxation on the Issue concerning the Payment of Enterprise Income Taxes by Logistic Enterprises

Guo Shui Han [2006] No.270

To the state taxation bureaus and local taxation bureaus of all provinces, autonomous regions, municipalities directly under the Central Government, and cities under separate state planning,

In light of the relevant spirit of the Notice on Printing and Distributing the Opinions on Promoting the Development of Modern Logistic Industry of China (Fa Gai Yun Xing[2004] No.1617) by the National Development and Reform Commission jointly with other eight departments, and in pursuant to the relevant provisions of the Interim Regulation on Enterprise Income Tax of the People's Republic of China and its detailed implementation rules, we hereby issue the following notice on relevant issues concerning the payment of enterprise income taxes by logistic enterprises in order to promote the development of the modern logistic industry, and enhance the competitiveness of the logistic enterprises,:

I.

With respect to the trans-regional institutions (including sites and networks) established by a logistic enterprise within the same province, autonomous region, or municipality directly under the Central Government, if they are enterprises under uniform operation and accounting system under the leadership of their headquarters without establishing bank settlement accounts or compiling financial statements and account book, and are interlinked with the headquarters and implement standardized management, their enterprise income taxes shall be paid uniformly by their headquarters, and the trans-regional institutions shall not pay enterprise income taxes at their own localities. Those trans-regional institutions that do not comply with any one of the aforesaid conditions shall not be included into the scope of unified tax payment, and shall pay their enterprise income taxes at their own localities.

II.

The aforesaid logistic enterprises shall refer to the economic organizations that meet the following requirements: registered at the administrative departments of industry and commerce; have or rent the necessary means of transport and storage facilities; have at least two or more scopes of business of undertaking transportation (or freight forwarding) and storage, and etc.; are able to provide such all-in-one services as transportation, agency, storage, loading and unloading, processing, cleanup, distribution, and etc.; have the information management system applicable to their own businesses, implement independent business accounting; are liable for their own profit and losses; and undertake civil liabilities independently.

III.

When the logistic enterprises pay their enterprise income taxes uniformly, their headquarters (head office) shall file an application to the competent taxation authority at the provincial level where it is located, and the competent provincial taxation authority shall notify the relevant competent tax authorities to implement it accordingly after making examination and confirmation.

IV.

When the logistic enterprises apply for paying enterprise income taxes uniformly, they shall file an application for unified tax payment to the competent taxation authority at the provincial level where it is located before March 31 of the year, and attach the business licenses and taxation registration certificates (in photocopy) of the headquarters and the trans-regional institutions, Articles of Association of the enterprises, the financial business accounting system of the enterprises, certificate of assets relationship between the headquarters and the trans-regional institutions, financial statements and tax returns of the headquarters in the previous year, name list of the trans-regional institutions and their localities, and other materials if necessary.

V.

The competent tax authorities at the localities of the logistic enterprises (including headquarters and trans-regional institutions) which pay enterprise income taxes uniformly shall strengthen the administration of tax collection on the headquarters and the trans-regional institutions and the supervisions thereof in light of the spirits of the documents and regulations of the State Administration of Taxation on the management of the enterprises that collective or unified pay taxes.

State Administration of Taxation

March 18, 2006