Laws of the People's Republic of China

Supplementary Circular of the State Administration of Taxation on Implementing Record-keeping Administration System of Relevant Documents for Tax Refund (Exemption) on Exported Goods

Guo Shui Han [2006] No. 904

State Taxation bureaus in all provinces, autonomous regions, municipalities directly under the Central Government and cities specially designated in the state plan:

In response to the problems reflected after the release of (Interim) Circular of the State Administration of Taxation on Implementing Record-Keeping Administration System of Relevant Documents for Tax Refund (Exemption) on Exported Goods (Guo Shui Fa [2005] No. 199, hereinafter referred to as the Circular), after research, a supplementary circular is hereby given as follows:

1.

Documents to be put on file as mentioned in Article 1 of the Circular, mainly refer to documents prescribed in the Contract Law of the People's Republic of China or documents stipulated by competent authorities on export trade. Considering that names of documents to be put on file of some enterprises may be not fully consistent with that stipulated in the Circular, therefore, the appendix to the Circular, Descriptions to Recording-Keeping of Relevant Documents for Tax Refund (Exemption) on Exported Goods has given a description of the implications, functions, effects and so on and so forth of relevant documents to be put on file, so that record-keeping administration in all localities may be carried out in accordance with the principles thereof. Where export enterprises fail to submit documents to be put on file as is stipulated in the Circular, documents of similar contents or effects shall be provided as documents to be put on file. Nonetheless, export enterprises that are to put documents on file for the first time shall present grounds in a written way and furnish formalities of relevant documents to competent tax authorities before they commit record-keeping. Bureaus of State Taxation in all provinces, autonomous regions, municipalities directly under the Central Government and cities specially designated in the State plan may also formulate, in light of de facto local conditions, specific provisions on administration of documents to be put on file in accordance with the rules and principles prescribed in the Circular.

2.

The annex to the Circular, Descriptions to Recording-Keeping of Relevant Documents for Tax Refund (Exemption) on Exported Goods requires that the "shipping orders of exported goods" have signatures of the Customs. Considering that it is difficult for export enterprises to secure "shipping orders of exported goods" signed by the Customs, in practical work, provided the "shipping orders of exported goods" to be put on records of export enterprises are in line with the implications of the Circular, signatures by the Customs shall not be a prerequisite.

3.

Where documents to be put on file of export enterprises are in the form of electronic data or paperless data, record-keeping can be taken in two methods:

(1)

Where paperless contracts such as electronic contracts and parol contracts instead of purchase and sale contracts in written form are concluded by export enterprises, provided they are in accordance with the provisions of the Contract Law of the People's Republic of China, electronic contracts shall be printed by export enterprises, parol contracts shall be recorded in written form, be signed by the handling person to indicate consistency with the facts and be affixed with official seals of enterprises for record.

As for record-keeping of other kinds of documents, in case export enterprises fail to secure paper documents or enterprise self-made electronic documents on account of the adoption of paperless administration by competent state administrative authorities, export enterprises may print pertinent electronic data into paper documents, affix them with official seals of enterprises and sign to indicate the consistency of the printed documents with the original electronic data.

(2)

Aside from parol contracts, as for electronic purchase and sale contracts concluded by export enterprises, documents under paperless administration by competent state administrative authorities and enterprise self-made electronic documents, export enterprises may carry out electronic documents record-keeping administration upon application in written form which must be approved by competent tax authorities, namely, export enterprises may put relevant documents on file in form of electronic documents. Export enterprises shall guarantee the authenticity of electronic documents on file, back up relevant electronic data in a regular way and, when tax authorities take documents to be put on file for inspection in accordance with rules and regulations, shall, in response to the requirements of the said authorities, provide electronic data or paper documents, that is, printed electronic documents affixed with official seals of enterprises.

4.

As regards businesses of special tax refund policies without involving export of goods, tax refund of the domestic equipment purchases of enterprises with foreign investment, tax refund of bid-wining electromechanical products, tax refund of power and gas in export processing zone, for instance, record-keeping administration system of documents shall not be implemented temporarily.

5.

Where documents to be put on file are incomplete after the release of the Circular, export enterprises shall make up for it in accordance with the provisions of the supplementary circular herein before November 30, 2006.

State Administration of Taxation

September 30, 2006