In the past week, departments and ministries under the jurisdiction of the State Council, China’s Cabinet, have responded to a number of public concerns, including a preferential tax policy, reform of the vehicle sales mechanism, smartphone safety, a national plan to make it easier for students from impoverished backgrounds to attend university and the replacement of business tax with value-added tax.
Preferential policy launched
To promote tax reduction and reduce the burden on businesses, the country’s tax authorities have launched a “three-dimensional” preferential policy. Liu Baozhu, deputy director of the department of income tax at the State Administration of Taxation, said the authorities will launch comprehensive policies and regulations related to the collection of taxes and service requirements. It will also reduce the cost of payment and collection. Key issues related to the implementation of the policy will also be clarified to help people understand the new system.
Businesses with preferential tax status will also be allowed to simply notify the authorities of that status, rather than being required to obtain official approval.
New vehicle sales mechanism
The Ministry of Commerce announced that a new method of managing vehicle sales will come into force on July 1 that will promote reform of the system of authorized sales. According to ministry officials, the method will promote a new model of multiple vehicle sales to boost competition, reduce retail costs, improve sales efficiency and energize the market.
A new relationship will be established between suppliers and retailers, and protection of consumer rights and interests will be improved. The main distributors and brand dealers will no longer be required to register with the authorities, while supervision of sales and after-sales services will be improved.
The General Administration of Quality Supervision, Inspection and Quarantine recently launched inspections related to smartphone safety. Eighteen of the 40 samples inspected had potential safety issues, which resulted in the administration reminding consumers to purchase smartphones through the approved, regular channels and keep valid proof of purchase, such as an invoice. People should also improve their awareness of the protection of private information and update their phone’s apps and operating systems regularly to reduce the risk of information leaks.
The Ministry of Education has confirmed that it will continue to implement a special nationwide program to make it easier for students from impoverished regions to study at key universities. The ministry said 63,000 impoverished students will be admitted to top schools this year, a rise of 10 percent from last year. The regions implementing the program include counties that face special challenges, along with national poverty relief and development counties and four regions in the south of the Xinjiang Uygur autonomous region. The ministry said the relevant universities must ensure that at least 2 percent of their undergraduates come from remote, impoverished areas or regions with large ethnic populations.
Tax reform continues
A year after replacing the business tax with value-added tax, China had reduced taxes by 680 billion yuan ($98.7 billion), according to Wang Jun, director of the State Administration of Taxation, speaking at the fourth meeting of the Organization for Economic Cooperation and Development’s Global Forum on Value-Added Tax.
After the January 2012 launch of a regional pilot program to replace business tax with value-added tax, levies were reduced by more than 1.2 trillion yuan, the largest reduction in recent years. Full implementation of the reform came into effect last year.
The administration said the financial and tax departments have launched several measures to smooth the implementation of the reform. The tax authorities have provided training for 21.3 million people, established a special phone hotline about the reform, and opened an extra 17,386 consultation windows in tax offices.