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CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON RELEVANT ISSUES CONCERNING STRENGTHENING VALUE-ADDED TAX ADMINISTRATION ON THE EXTENDED VALUE-ADDED TAX CREDIT SCOPE IN THE NORTHEAST REGION

State Administration of Taxation

Circular of the State Administration of Taxation on Relevant Issues concerning Strengthening Value-added Tax Administration on the Extended Value-added Tax Credit Scope in the Northeast Region

Guo Shui Han [2004] No.1111

Bureaus of State Taxes in Provinces of Heilongjiang, Jilin and Liaoning, and Dalian City:

In order to strengthen the value-added tax (VAT) administration on the extended scope for input VAT credit for some industries in the Northeast region, a circular is hereby given on relevant issues:

I.

The taxation authorities in charge shall, strictly in accordance with the spirit in Circular of the Ministry of Finance and the State Administration of Taxation on the Printing and Distribution of the Provisions on Several Issues concerning Extending Value-added Tax Credit Scope in Northeast Region (Cai Shui Zi [2004] No.156 (hereafter referred to as the Provisions)), further determine the VAT general taxpayers (hereafter referred to as the taxpayer) subject to the extended VAT credit scope, and distribute the names of taxpayers to all the service points; and the working staffs in each service point, when handling a tax declaration of a taxpayer, shall ascertain whether it is subject to the extended credit scope.

II.

The taxation authorities in charge shall, strictly in accordance with the spirit in the Provisions, examine earnestly the purchase and use of the fixed assets on which an ascertained taxpayer applies for an input VAT credit. Where the fixed assets purchased by a taxpayer is used beyond the pilot industries in the Northeast region (including its branches established without the territory of the Northeast region), its input VAT shall not be credited.

III.

The taxation authorities in charge shall examine the special invoice and the real object of the fixed assets on which a taxpayer applies for an input VAT credit.

1.

Do well the work of distinguishing the special invoice and other documents for tax credit. A tracking administration shall be exerted on the information on the special invoice of the fixed assets on which a taxpayer applies for an input VAT credit, and the taxation authorities in charge shall pay timely attention to the distinguishing of relevant VAT special invoices, the tax payment certificates issued by the customs authorities, transportation invoices, invoices issued by the taxation authorities, and treat the detected problems in accordance with the relevant provisions.

2.

Examine earnestly the coherence between the special invoice and other documents for tax credit and the real object of the fixed assets. With regard to the fixed assets on which a taxpayer applies for an input VAT credit, the taxation authorities in charge shall check the account book for the fixed assets, and conduct an on-scene inspection in the manufacturing and business site of the taxpayer hereof. The coherence between the real object of the fixed assets and the special invoice shall be checked, and the input VAT shall not be credited in case that there is no such a real object or incoherence between the special invoice and the real object of the fixed assets.

IV.

Where a taxpayer acquires a plain invoice through the purchase of fixed assets within the period of from July 1, 2004 to September 30, 2004, he/she, when requesting a VAT special invoice from the supplier, shall return the plain invoice hereof. And the supplier, when issuing a VAT special invoice, shall ascertain that the purchaser's name and the name of the goods are coherent with those in the plain invoice hereof, and that the sales amount and the output tax are coherent with those in the plain invoice hereof.

A supplier, when going through the formalities of tax declaration, shall offer the original copy of the returned and invalided plain invoice, otherwise, the declared output tax shall not be credited.

State Administration of Taxation

September 30, 2004

  State Administration of Taxation 2004-09-30  


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