Government to Expand Tax Cutting Program to Three More Regions
The State Administration of Taxation announced that the government has decided to expand its trial of replacing business tax with the value added tax to three more provincial regions. The change in the value added tax to a tax on revenue was applied to transportation and services business based on a statement made on the administration’s website.
Last January 1 Shanghai was chosen to pilot a tax cutting program in efforts to decrease overall tax burden and to boost transportation and services sectors. The program was then expanded to more regions and provinces of Anhui, Jiangsu, Guangdong and Fujian and later this year was expanded to Beijing, Xiamen and Shenzhen.
If successful the tax cutting program is likely to be expanded to cover rail transportation, telecommunications, construction and installation industries by 2013. The tax cut has helped industries reduce its tax burdens by more than 22 billion yuan in the first ten months of this year in Shanghai while Beijing was able to cut tax revenue by 2.5 billion in just two months.
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