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China's New Urban Maintenance And Construction Tax Law In Force

Wednesday, September 15, 2021

China's Ministry of Finance and the State Administration of Taxation have issued a statement announcing tax relief from the Urban Maintenance and Construction Tax.

A new law to govern the tax became effective from September 1, 2021.

The levy – a surcharge levied on top of VAT and excise duties on the domestic supply of goods – continues to feature rates of seven percent for suppliers based in cities, five percent for those based in towns, and one percent for other localities.

In Announcement No. 27 of 2021, released on August 24, 2021, Chinese authorities announced a number of concessions, including:

  • Standard gold sold by members of the Gold Exchange through the Gold Exchange and physically delivered is exempt;
  • Standard gold sold by members and customers of Shanghai Futures Exchange through the exchange and physically delivered is exempt;
  • Projects funded by the national major water conservancy project construction fund are exempt;
  • From January 1, 2019, until December 31, 2021, the tax will be halved for small-scale VAT taxpayers.