Bases for Taxation-Value-Added Tax

China Taxation Service
Hotline: 86-755-82143348, Email:anitayao@citilinkia.com

1.If the deposits charged by the taxpayers when leasing or lending the packing articles for selling goods are separately booked and accounted， they shall not be included into the value of sales for tax collection. However， if the deposits are not refunded because the packing articles are not returned after the time limit， value-added tax shall be collected at the tax rates applicable to the packed goods.

2.When the taxpayers sell goods at discount， value-added tax shall be collected according to the discounted value of sales if the value of sales and the discounted amount are separately marked in the same invoice. But if a separate invoice is issued for the discounted amount， the discounted amount shall not be deducted from the value of sales no matter how they are financially treated.

3. If the taxpayers use the trade-in method to sell goods， the value of sales shall be determined according to the selling prices of the new goods in the same period.

4. If the taxpayers sell goods through principal repayment， the expenditure on principal repayment shall not be deducted from the value of sales.

5. If the selling prices of the taxpayers are obviously low or the taxpayers have no selling prices and if the taxable prices shall be formed as required to determine the value of sales， the cost-profit ratio in the price-forming formula shall be 10%. But if the consumption tax of the goods shall be collected according to the ad valorem ratio， the cost-profit ratio in the pricing-forming formula shall be the cost-profit ratio specified in the Regulations on Some Specific Issues regarding Consumption Tax.

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