Detailed Rules for Implementation
of Provisional Regulations of the People's Republic of
China on Stamp Tax
Article 1 These Detailed Rules were formulated according
to stipulations in Article 15 of the "Provisional Regulations
of the People's Republic of China on Stamp Tax" (hereinafter
referred to simply as ' Regulations' )
Article 2 'Documents which are executed or received in
the categories specified in these regulations and within
the borders of the People's Republic of China' in Article
1 of the regulations refers to documents which have the
force of law within the borders of China and receive the
protection of Chinese law.
The above mentioned documents, whether they are executed
within or outside the borders of China , are all subject
to Stamp Tax according to regulations.
The 'units and individuals' in Article 1 of the regulations
refers to the various types of domestic enterprises, public
institutions 9 administrative organizations 9 social groups
and the armed forces, as well as to Chinese-foreign equity
joint ventures , Chinese-foreign contractual joint ventures,
wholly foreign funded enterprises, foreign enterprises,
foreign companies and enterprises and other economic organizations
and u-nits and individuals in their offices in China.
All Chinese-foreign joint ventures, Chinese-foreign equity
joint ventures, contractual joint venture, wholly foreign
funded enterprises, foreign companies and enterprises and
other economic organizations which pay Consolidated Industrial
and Commercial Tax (CICT) may offset the full amount of
their Stamp Duty payments against their CICT payments .
Article 3 Contracts for construction projects' in Article
2 of the Regulations refers to building project survey and
design contracts and construction and installation contracts.
Construction and installation contracts include general
contracting, sub-contracting and assignment contracting.
Article 4 'Contracts' in Article 2 of the Regulations refers
to contracts concluded in accordance with the " Economic
Contract Law of the People's Republic of China " ,
the "Foreign Economic Contract Law of the People's
Republic of China " and other contracts related to
contract law legislation.
'Documents of a contractual nature' refers to agreements,
deeds, treaties, transaction documents, letters of confirmation
and other similar types of documents which have the validity
of a contract.
Article 5 'Documents which transfer property rights' in
Article 2 of the Regulations refers to documents including
the transfer of property rights by units and individuals,
through such means as purchase, sale, inheritance, gift,
exchange or division.
Article 6 'Business account books' in Article 2 of the
Regulations refers to books of account in which a unit or
individual records the financial and accounting details
of its production and business activity.
Article 7 'Books of accounts which record funds listed
in the Table of Stamp Taxable Items and Tax Rates' refers
to general ledgers recording the original value of fixed
assets and internal working funds or books of account set
up specifically to record the original cost of fixed assets
and internal working funds.
'Other account books' refers to books of account other
than those mentioned above, including combined journals
and ledgers and all types of detailed subsidiary ledgers.
Article 8 When account books which record investment according
to the original value of fixed assets and internal working
funds are stamped", and there is an increase in the
total annual value of investment compared to that original
stamped value, an additional tax corresponding to the increase
in value shall be stamped on the document, according to
regulations.
Article 9 Determination of 'internal working funds' in
the Table of Stamp Taxable Items and Tax Rates shall be
implemented according to regulations of the relevant financial
accounting system.
Article 10 Stamp Tax shall only be payable on documents
listed in the Table of Stamp Taxable Items and Tax Rates
and other documents subject to Stamp Tax as prescribed by
economic, financial and administrative departments.
Article 11 Exemption from Stamp Tax of ' copies or written
transcripts of documents on which Stamp Tax has already
been paid' in Article 4 of the Regulations refers to cases
where Stamp Tax has already been paid on the official version
of a document in accordance with regulations and any copies
or written transcripts are then exempt from Stamp Tax if
they do not create any rights or obligations involving others,
but are retained only for reference purposes.
If a copy or written transcript of a document is regarded
as having the same application as the official document,
an additional Stamp Tax payment shall be levied.
Article 12 'Social welfare units' in Article 4 of the Regulations
refers to social welfare units that care for orphans, the
elderly, the injured and the disabled.
Article 13 In accordance with provisions of Item 3 of Article
4 of the Regulations, the following documents shall be exempt
from Stamp Tax:
A. agricultural by-product purchase contracts between State
designated buying departments and village committees or
individual peasants;
B. non-interest bearing or discounted loan contracts;
C. preferential loan contracts between foreign government
or international financial organizations and the Chinese
government or State financial organizations.
Article 14 'Tax stamps shall be affixed to taxable documents
at the time the document is executed or when it is received'
in Article 7 of the Regulations refers to tax stamps which
are affixed on the signing of contracts, the establishment
of written instruments, the initial use of account books
or the receipt of certificates.
If a contract is signed outside China , Stamp Tax shall
be paid when it is applied within China .
Article 15 'The interested parties' in Article 8 of the
regulations refers to units and individuals with direct
power, liability and relationship with the document, but
does not include guarantors, witnesses or appraisers.
The person who concludes the contract in the Table of Stamp
Taxable Items and Rates of Tax refers to the interested
parties in the contract.
An interested party's agent has liability to act as an
agent in paying tax.
Article 16 Documents which transfer production rights shall
be stamped by the issuer of the documents. If the documents
are not stamped or inadequately stamped, the person holding
the documents is responsible for making up the shortage.
All documents in the form of contracts to be signed, shall
be stamped in full, on a share basis, by the various parties
holding the contracts.
Article 17 Where different tax rates apply to the same
document because two or more economic items are recorded
therein, if the amounts are recorded separately, the amount
of tax payable shall be calculated separately and after
the amounts are added together, the total Stamp Tax due
shall be paid. If the amounts are not recorded separately,
Stamp Tax shall be calculated using the highest of the applicable
tax rates.
Article 18 Where Stamp Tax on a taxable document is based
on the ratio of funds, and the amount of funds is not indicated
on the document, it may be calculated in accordance with
the amount recorded within the document and the State's
listed price. If there is no applicable State listed price,
the amount of funds shall be calculated in accordance with
the market price. The amount of Stamp Tax payable shall
then be calculated according to the stipulated tax rate.
Article 19 Where funds recorded in a taxable document are
in a foreign currency, the taxpayer shall calculate the
amount of Stamp Tax payable by converting the foreign currency
amount into Renmimbi, using the foreign exchange rate quoted
by the State Administration of Exchange Control of the People's
Republic of China, on the date of conclusion of the document.
Article 20 Tax stamps shall be canceled immediately after
being affixed to a taxable document. If a taxpayer has a
seal, tax stamps may be canceled by affixing the seal to
the stamps. If a taxpayer does not have a seal, tax stamps
may be canceled by drawing several horizontal lines through
the stamps with a fountain pen (ball-point pen). The cancellation
lines shall extend beyond the junction between an attached
tax stamp and the document or the junction with other tax
stamps.
Article 21 Where the amount of Stamp Tax payable on one
document exceeds 500 yuan, an application shall be lodged
with the local taxation authorities for a payment slip or
payment settlement certificate to be attached to the document
or the tax authorities may affix to the document a symbol
indicating payment of Stamp Tax, thereby replacing the need
to affix stamps.
Article 22 Where the same type of taxable documents makes
frequent payment of Stamp Tax necessary, application may
be made to the local taxation authorities to pay the collective
total periodically.
The taxation authorities shall issue collective payment
permits to units who calculate and prepare collective payment
of their Stamp Tax. The limits on the amount and the payment
time shall be determined by the local taxation authorities,
but the time limit on payment shall not exceed one month.
Article 23 Where the Stamp Tax is paid periodically, the
taxation authorities shall affix a collective payment stamp
and serial numbers on the documents and, after being bound
into a complete book and after tax stamps or payment slip
attachments are canceled by stamping, the documents shall
be retained for future reference.
Article 24 Where a taxpayer attached tax stamps to more
than the value of the tax payment due, he may not apply
for a refund or offset the excess amount against other payments.
Article 25 The taxpayer shall properly store taxable documents.
For all documents which have a State regulated time period
for retention, handle matters following regulations; other
documents shall be stored for one year after their expiry
date.