Export Enterprises to Benefit from Increased Tax Rebates

Application for export rebates

During the epidemic prevention and control period, the tax bureau implemented several “non-contact” processing of taxes. This includes the application for tax rebates. Enterprises were advised to handle business-related applications online and make use of 12366 tax service hotlines and other online platforms.

Nevertheless, enterprises eligible for the increased export rebates must provide their business licenses and approval documents for export. They are also required to stick to the monthly tax declaration.

To alleviate the burden of handling tax refunds, the tax administration also moved to shorten the application processing time from 10 to less than 8 working days.

VAT refund on research and development industry

Domestic and foreign institutions under research and development will also enjoy a full refund of VAT concerning the purchase of domestic equipment. The refund period has applied from January 1, 2019, until December 21, 2020.

Furthermore, the above institutions can apply for tax declaration of their domestic purchases before August 21, 2020 instead of the scheduled date on April 30, 2020.

Key takeaways

Upon implementation of the tax rebate policy, SAT has already approved export tax rebates worth RMB204 billion for almost 230,000 export enterprises. Thus, it effectively reduced the financial pressure among the export trading companies.

Due to the widespread factory shutdown during the virus outbreak, China’s economy has experienced a sharp decline in its industrial output. The rebates, however, may have helped in lessening the impact of reduced trade amid the COVID-19 pandemic.

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