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CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION CONCERNING THE ISSUE THAT ENTERPRISES WITH FOREIGN INVESTMENT ENGAGED IN CABLE CAR SERVICE FOR TOURISM ARE NOT PRODUCTIVE ENTERPRISES

The State Administration of Taxation

Circular of the State Administration of Taxation Concerning the Issue that Enterprises with Foreign Investment Engaged in Cable Car
Service for Tourism are not Productive Enterprises

GuoShuiFa [2003] No.36

March 28, 2003

State taxation bureaus and local taxation bureaus of provinces, autonomous regions, municipalities directly under the Central Government
and municipalities separately listed on the state plan:

It is investigated that some localities regarded enterprises with foreign investment engaged in cable car service for tourism as productive
enterprises and offered them corresponding preferential tax treatment. In order to implement tax law correctly, it is hereby clarified
as follows:

According to the stipulation on productive enterprise scope in Article 72 of the Rules for the Implementation of Income Tax Law of
the People’s Republic of China for Enterprises with Foreign Investment and Foreign Enterprises, Enterprises with foreign investment
engaged in cable car service for tourism are not productive enterprises. Those enterprises, which have been offered corresponding
preferential tax treatment as productive enterprises, should pay the reduced or remitted tax retroactively with 3 months after receiving
the circular, but they needn’t pay late fee.



 
The State Administration of Taxation
2003-03-28

 







CIRCULAR OF THE STATE ADMINISTRATION OF FOREIGN EXCHANGE ON DOMESTIC INSTITUTIONS USING RENMINBI AS PRICING CURRENCY IN FOREIGN TRADES

The State Administration of Foreign Exchange

Circular of the State Administration of Foreign Exchange on Domestic Institutions Using Renminbi as Pricing Currency in Foreign Trades

HuiFa [2003] No.29

March 3, 2003

Branches and foreign exchange administration departments under the State Administration of Foreign Exchange in provinces, autonomous
regions and municipalities directly under the Central Government, and branch administrations of Shenzhen, Dalian, Qingdao, Xiamen,
Ningbo; and Chinese-capital designated banks of foreign exchange:

In response to requests from some domestic institutions to use Renminbi as pricing currency in foreign trade agreements and with a
view to promoting smooth development of foreign trade and to further strengthening capacity of international competition of domestic
institutions by adopting more flexible method of settlement in foreign trade transactions, the Circular on relevant provisions is
hereby issued after consideration:

I.

The domestic institutions may use Renminbi as pricing currency in signing import/export contracts.

II.

Where domestic institutions use Renminbi as pricing currency in export contracts, the foreign exchange shall be duly collected in
whole at the exchange rate quoted by the bank on the date of settlement in the course of handling procedures of collecting export
foreign exchange earnings.

III.

Where domestic institutions use Renminbi as pricing currency in import contracts, the payment to foreign party shall be made in foreign
exchange in any of the currency listed by domestic banks after converting the amount of Renminbi stipulated in the contract at the
exchange rate quoted by the bank on the date of settlement in the course of handling procedures of payment to foreign parties under
the import business.

IV.

Where domestic institutions use Renminbi as pricing currency in contracts and in making Customs declarations, they shall handle verification
procedures for export collection and import payment of foreign exchange in accordance with relevant regulations.

V.

The Circular shall enter into force as of the date of its promulgation.

Upon receipt, all branches shall promptly transmit the Circular to their respective subordinate sub-branches and concerned units while
all Chinese-capital designated banks of foreign exchange shall promptly transmit it to their branches and sub-branches. Please feedback
timely to the State Administration of Foreign Exchange any problems encountered in the course of implementation of the Circular.



 
The State Administration of Foreign Exchange
2003-03-03

 







SUPPLEMENTARY CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION CONCERNING THE PREFERENTIAL POLICY OF ENTERPRISE INCOME TAX FOR ENTERPRISES WITH FOREIGN INVESTMENT WITH ADDITIONAL INVESTMENT

The State Administration of Taxation

Supplementary Circular of the State Administration of Taxation Concerning the Preferential Policy of Enterprise Income Tax for Enterprises
with Foreign Investment with Additional Investment

GuoShuiHan [2003] No.368

March 28, 2003

For the purpose of implementing the Circular of the State Administration of Taxation and Ministry of Finance Concerning the Preferential
Policy of Enterprise Income Tax for Enterprise with Foreign Investment with Additional Investments (CaiShuiZi [2002] No.56), some
related issues are hereby further specified:

I.

About the scope of hortative items

According to the provisions of the Circular of the State Administration of Taxation on Implementation of New Guidance Catalogue for
Foreign-invested Industries, the hortative items stipulated in the CaiShuiZi [2002] No.56 refer to the foreign investment items with
additional investments approved before April 1, 2002, which are regarded as the hortative items and Limited-type B listed in the
Guidance Catalogue for Foreign-Invested Industries promulgated by the former State Development and Plan Commission and other relative
departments in 1997. The foreign-invested items with additional investments that are approved after April 1, 2002 are regarded as
the hortative items specified in the Guidance Catalogue for Foreign-invested Industries promulgated by the former National Development
and Plan Commission and other relative departments in 2002.

II.

About calculation of the incremental registered capitals after multiple additional investments

All the production items formed through multiple additional investments after initial investment of an enterprise with foreign ivestment,
which have not enjoyed any preferential treatment of fixed-term abatement or exemption of taxes (except for the additional investments
that have not formed production items) may be merged into one item for calculating the its new incremental registered capital. If
this new incremental registered capital meets with the requirements specified in Article 1 of CaiShuiZi [2002] No.56, it may enjoy
preferential treatment of fixed-term abatement or exemption of taxes for the independent item after the merge.

III.

About calculation of original registered capital

The “original registered capital” specified in CaiShuiZi [2002] No.56 refers to the registered capital formed before the enterprise
with foreign ivestment inputs additional investments on the new production items or on the merged items specified in Article 2 of
this Circular.

IV.

About calculation of preferential periods of abatement or exemption of taxes for the additional investments

For the production item formed from merging multiple additional investments of an enterprise with foreign ivestment, which enjoys
a preferential treatment of fixed-term of tax abatement or exemption according to Article 2 of this Circular, the preferential period
shall be calculated from the year in which the enterprise begins to obtains profits from the production item formed since the first
additional investment. The enterprise shall begins to enjoy the residual preferential treatments in the preferential period of tax
abatement or exemption from the year in which the additional investments reach the requirements specified in CaiShuiZi [2002] No.56.



 
The State Administration of Taxation
2003-03-28

 







CONSTITUTION ACT, 1982 – page 22

NOTES (1) The enacting clause was repealed by the Statute Law Revision Act, 1893, 56-57 Vict., c. 14 (U.K.). It read as...