Laws of the People's Republic of China

    For the purpose of implementing the Decision of the State Council
on Strengthening the Administration of Extra-budgetary funds(Guo Fa No.
[1996]29), the policy for business tax on fees and funds collected for
administrative purposes has been formulated upon approval of the State
Council for compliance in implementation.

    I.Business tax or value-added tax shall be levied and collected
in accordance with provisions from charges not included in the calculated
prices collected by the taxpayer from the other party along with the price
including service charge, funds, fund-raising fees, collection of payment,
disbursement and fee collection not included in the calculated prices for
various other purposes. With respect to various funds integrated into
budget management in accordance with the provisions of the Guo Fa No.
[1996]29 Document, whenever it is formed through extra price not included
in the calculated prices, it shall be integrated into the budget upon
payment of the circulating tax.

    II.Excluding the provisions of the above Article, no business tax shall
be levied and collected from fees collected for administrative purposes and
funds integrated into budget management or designated financial account
management approved by the department of finance of the Central Government
and the departments of finance of the provinces; business tax shall all be
levied and collected in accordance with the provisions for the fees and funds
not integrated into budget management or designated financial account
management.

    III.To facilitate the administration of levying and collection, lists of items for the collection of fees(funds) exempt from business tax shall be
issued in batches by the Ministry of Finance and the State Administration
of Taxation with respect to fees collected for administrative purposes and
funds approved by the Central Government to be integrated into budget
management or designated financial account management; with respect to
fees collected for administrative purposes approved at the provincial
level to be integrated into budget management or designated financial
account management, lists of items for the collection of fees exempt
from business tax shall be issued in batches by the provincial
departments(bureaus) of finance and local tax bureaus and submitted
to the Ministry of Finance and the State Administration of Taxation
for the record. Business tax shall be levied and collected according to
regulations with respect to the items not included in the lists.

    IV.Items of fee collection involving tax levying of state organs,
institutions and social groups shall be integrated into tax administration,
entered into tax registration and tax declarations made and tax invoices
used for items of fee collection. For items of fee collection and funds
exempt from tax, vouchers for fee collection and funds uniformly printed
by the departments of finance at or above the provincial level shall be
used.