Provisions on Some Specific Issues Regarding Value-Added Tax

　　1. Scope of Taxation
　　（1）The goods futures（including commodity futures and precious metal futures）are subject to value-added tax.
　　（2）The selling of gold and silver by banks is subject to value-added tax.
　　（3）The financial leasing is not subject to value-added tax，no matter whether the ownership of the leased goods has been transferred to the leasees.
　　（4）If the cement prefabrications，other components or building materials produced in the factories and workshops attached to the units engaged in capital construction or to the enterprises engaged in construction and installation are used for the construction projects of these units or enterprises，value-added tax shall be levied when they are moved for use. However，if the prefabrications produced at the construction sites are directly used for the construction projects of these units or enterprises，they are not subject to value-added tax.
　　（5）The selling of dead pawns by the pawn-broking industry and the selling of consigned goods by the consignment industry on behalf of the consignors are all subject to value-added tax.
　　（6）The selling of master films，master videos and master cassettes arising from the transfer of copyrights and also the selling of computer software products arising from the transfer of the ownership of patented and unpatented technologies are not subject to value-added tax.
　　（7）The supply or extraction of unprocessed natural water（for example，the reservoirs supply water for agricultural irrigation and the factories extract groundwater for production）are not subject to value-added tax.
　　（8）The selling of collectible stamps and first-day covers by the postal departments is subject to value-added tax.
　　（9）Sewing is subject to value-added tax.
　　2. Bases for Taxation
　　（1）If the deposits charged by the taxpayers when leasing or lending the packing articles for selling goods are separately booked and accounted，they shall not be included into the value of sales for tax collection. However，if the deposits are not refunded because the packing articles are not returned after the time limit，value-added tax shall be collected at the tax rates applicable to the packed goods.
　　（2）When the taxpayers sell goods at discount，value-added tax shall be collected according to the discounted value of sales if the value of sales and the discounted amount are separately marked in the same invoice. But if a separate invoice is issued for the discounted amount，the discounted amount shall not be deducted from the value of sales no matter how they are financially treated.
　　（3）If the taxpayers use the trade-in method to sell goods，the value of sales shall be determined according to the selling prices of the new goods in the same period.
　　If the taxpayers sell goods through principal repayment，the expenditure on principal repayment shall not be deducted from the value of sales.
　　（4）If the selling prices of the taxpayers are obviously low or the taxpayers have no selling prices and if the taxable prices shall be formed as required to determine the value of sales，the cost-profit ratio in the price-forming formula shall be 10%. But if the consumption tax of the goods shall be collected according to the ad valorem ratio，the cost-profit ratio in the pricing-forming formula shall be the cost-profit ratio specified in the Regulations on Some Specific Issues regarding Consumption Tax.
　　3. Standards for Small Taxpayers
　　（1）The value of sales mentioned in the provisions on the standards for small taxpayers specified in Article 24 of the Regulations on Value-Added Tax refers to the value of sales of the small taxpayers specified in Article 25 of the same Regulations.
　　（2）The taxpayers specified in Article 24 of the above Regulations who are mainly engaged in the production of goods or the provision of taxable labor and also engaged in the wholesale or retail of goods refer to the taxpayers whose value of sales for goods or taxable labor exceeds 50% of the total annual taxable value of sales or whose value of sales of the wholesale or retail goods is below 50%.
　　4. When the fixed businesses sell goods outside their native counties（cities），they shall apply to the competent tax authorities in the places where their institutions are located for issuing the tax management certificates on outside economic activities and return to the places where their institutions are located for making tax reports to the tax authorities. If these businesses do not have the tax management certificates on outside economic activities issued by the competent tax authorities in the places where their institutions are located，the competent tax authorities in the places of sales must collect tax at the rate of 6%. With regard to the value of sales occurred in the places of sales，these businesses shall still make tax declarations as required after they return to the places where their institutions are located and the tax paid by them at the places of sales shall not be deducted from the payable tax in the period.