China will change its business taxation to value added tax (VAT) this year, which will lead to a reduction in taxation, as revealed in a statement after a meeting of the State Council on Jan 22.

The meeting, presided over by Premier Li Keqiang, featured discussion on further implementing changes from business taxation to VAT, accelerating its reform of the fiscal and tax systems, and further reducing cooperate tax.

During the meeting, the Premier stressed that the reform of the fiscal and tax systems has a wide influence and attracts great attention. The change from business tax to VAT is a crucially important part for deepening the fiscal and tax reforms. This year, the government will further promote the change and better help reduce corporation taxation. This will exert great and positive influence on developing the country’s service industry, especially those hi-tech enterprises, and on industrial upgrading.

[Photo/China News Service]

The Premier said several steps should be made in promoting the change from business tax to VAT as well as deepening fiscal and taxation reform. First, efforts should be made in encouraging the role of the market. Second, change in taxation needs to help encourage industrial development from both the central government as well as for regions. At the same time, consideration should be made in implementing fiscal and taxation reforms. This year, as the government will further implement the change from business tax to VAT, there would be large scale of cooperate tax reduction. That remains a serious measure for both central government as well as regional government.

Premier Li stressed that there is a certain amount of pressure on financial revenue, and government at all levels should combine efforts in meeting future challenges as well as ongoing taxation reform.

[Photo/China News Service]

[Photo/China News Service]