China to Call Off Preferential Tax Treatment

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Last updated at: (Beijing Time) Friday, November 23, 2001

China to Call Off Preferential Tax Treatment

China will unify the country's tax system and call off a series of preferential policies in tax collection. From 2002, except the value-added tax and tax rebate for export, all preferential policies wil be abolished.

All enterprises enjoy same tax treatment

China will unify the country's tax system and call off a series of preferential policies in tax collection, Beijing Morning Post reported Thursday.

China will provide the Most Favored Nation (MFN) status to enterprises of other countries. All enterprises, no matter Chinese or foreign, should enjoy the same national treatment, said an official with the State Administration of Taxation (SAT).

All state preferentail policies abolished

At present, the state tax for imported products is higher than for China-made goods.

Starting from 2002, all state preferential policies for promoting import and export will be abolished, except the value-added tax and the tax rebate for export, the official said, addingthe practice is based on the WTO rules and China's commitments under the WTO system.

Influence of China's Entering WTO on China's Tax Law System

China's entering WTO aims to resolve two problems: market access and the reform of the tax system. We have begun to realize the fact that tax law has become a close part of our everyday lives ever since the levying of interest tax last year.

WTO possesses three functions: as an international legal entity, an encompassing body of international trade treaties,and a venue for multilateral trade negotiations (MTN).

China's entrance into the WTO will lead to a series of reforms in China's current laws and regulations.

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