Business Tax

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5 Business Tax

TAXPAYERS

TAXABLE ITEMS AND RATES

TAX COMPUTATION METHODS

TAX REDUCTIONS AND EXEMPTIONS

LIABILITY, TIME LIMIT, AND PLACE FOR TAX PAYMENT

This tax, widely used around the world, is levied on specified profit-making causes and business activities. The Provisional Regulations of the People's Republic of China on Business Tax currently in force was promulgated by the State Council on December 13, 1993, and came into effect on January 1, 1994.

Business Tax is administered by the State Administration of Taxation (SAT) and the local tax bureaus. The revenue collected is shared between the Central Government and the local governments. This tax represents the most important source of tax revenue for the local governments. In 2003, revenue from Business Tax amounted to 286.89 billion yuan, accounting for 14.2% of the country's total tax revenue.

TAXPAYERS

Entities and Activities Subject to Business Tax

  • State-owned enterprises (SOEs), collective enterprises, private enterprises, enterprises with foreign investment, foreign enterprises, joint-equity enterprises, and other enterprises.
  • Administrative units, institutions, military units, social organizations, and other units.
  • Individual business operators and other individuals engaged in the provision of taxable services, the transfer of intangible assets and/or the sales of immovable properties within the territory of the People's Republic of China.

Where units or individuals construct and sell buildings, the construction is deemed to be the provision of taxable labor services.

The transfer of limited property rights or permanent use rights, and the gifting of immovable properties by units to others are deemed as sales of immovable properties.

Mixed Sales

Sales activities involving both taxable services and goods are termed mixed sales.

VAT shall be levied instead of Business Tax on the mixed sales of enterprises engaged in production, the wholesaling/retailing of goods, units of an enterprise nature, and individual businesses (including those engaged mainly in goods production and/or wholesale/retail, and concurrently engaged in taxable services).

The mixed sales of other enterprises, units and individuals (excluding the mixed sales of single institutions of independent accounting and sales of goods engaged in by those enterprises, units and individuals) are deemed to be the provision of taxable services, and are subject to Business Tax.

Taxpayers concurrently engaged in taxable services and/or goods, or in non-taxable services should calculate separately the turnover and sales volume of each activity. Otherwise, the relevant tax departments shall levy VAT on all of the activities instead of Business Tax.

For businesses leased or contracted to others, the lessees or the contractors shall be the taxpayers. The lessees periodically pay rental to the lessors while the contractors periodically pay contract fees to the principals, which operate businesses and file accounts independently of the lessees or contractors.

Revenue Breakdown

At present, Business Tax revenue comes mostly from the following:

  • SOEs.
  • Collectively-owned enterprises.
  • Private enterprises.
  • Joint-equity enterprises.
  • Enterprises with foreign investment that are engaged in the transportation, construction, finance and insurance, telecommunications, catering, commercial services, or real estate industries.

Withholding Agents

The withholding agent is not the taxpayer but the one who withholds the tax from the taxpayer from payments to the taxpayer and then pays forwards the withheld amount to the government. Different activities have different withholding agents for the Business Tax payable.

  • Financial institutions delegated to make loans: These delegated institutions shall be the withholding agents.
  • Subcontracting or transferred contracting of construction and installation businesses: The prime contractor shall be the withholding agent.
  • Overseas units or individuals that have taxable activities within China but no establishments: Their agents shall be the withholding agents. Where there is no agent, the transferees or the purchasers shall be the withholding agents.
  • Units or individuals that present performances for which tickets are sold by others: The ticket sellers shall be the withholding agents.
  • Individuals transferring patents, non-patent technology, trademarks, copyright, and/or goodwill: The transferees shall be the withholding agents.
  • Others: As stipulated by the Ministry of Finance.

TAXABLE ITEMS AND RATES

Currently, there are nine categories of taxable items, based on flat rates.

Table 5.1 Taxable items and tax rates
Taxable ItemsScopeTax Rates
* For countryside credit firm reform trials (including those in the 29 provinces, autonomous regions and municipalities directly under the State Council, except for Hainan Province and Tibet), the Business Tax rate levied on the countryside credit firms may be 3%.
1. TransportationLand transportation (by railway, road, cable car, or cableway), water transportation (across large rivers, rivers, lakes, or seas), air transportation, pipeline transportation, and loading/unloading and delivery.3%
2. ConstructionConstruction, installation, repair, decoration, commission-based engineering operations for telecommunication projects, water conservancy, the construction of roads, dredging, drilling of wells, the demolishing of buildings, the levelling of and, the setting up of scaffolds, and dynamite.3%
3. Financial and insurance businessesa. Finance: The provision of loans, financial leasing, the transfer of financial products, financial brokerages, and other financial institutions.
b. Insurance.
5%*
4. Postal and telecommunications businessesa. Post: The delivery of correspondence and packages, postal remittances, the issuance of newspapers and magazines, the sale of postal items, and postal savings.
b. Telecommunications: By telegraph, facsimile, or telephone; the installation of telephones; and the sale of tele-items.
c. Express delivery.
3%
5. Culture and sportsa. Culture: Performance, b roadcasting, exhibitions, training, lecturing, the lending of books, sightseeing spots.
b. Sports: Organizing sports matches, and the provision of arenas for sports activities.
3%
6. Entertainmenta. Singing halls, karaoke halls, music tea houses (e.g., bars), golf, games and amusement (e.g., shooting, hunting, horse racing, game machines, bungee jumping, go-karts, hot-air balloons, powered parachutes, archery, darts, and Internet cates.
b. Billiards and bowling.
20%
5%
7. ServicesAgencies, hotels, c atering, tourism, warehousing, leasing, advertising, bath houses, hair salons, clothes dyeing, photography, all forms of art, picture mounting, copying, typewriting, engraving, computation, testing, experiments, laboratory testing, tape recording, video recording, duplicating, blueprints, design, drawing, surveying, prospecting (excluding aviation, drilling, well digging, and explosion prospecting), packaging, and consultation.5%
8. Transfer of intangible assetsThe transfer of land-use rights, patent rights, non-patent technologies, trademarks, copyright, goodwill, film copyrights, and display rights.5%
9. Sale of immovable propertiesSales of buildings and other attachments to land.5%

Any adjustment to the items and rates must be sanctioned by the State Council.

If the taxpayers deal in items for which different tax rates apply, the taxpayers should calculate separately the turnover, transfer value and/or sales value (hereafter refered to as turnover) of the various taxable items. Otherwise, the tax department shall apply the highest rate in computing the tax payable.

TAX COMPUTATION METHODS

General Treatment

For taxpayers that provide taxable services, transfer intangible assets, or sell immovable properties, the Business Tax payable shall be computed based on the turnover and the applicable tax rate.

Tax payable = Turnover × Applicable tax rate

Example A

The turnover of a transportation company is 2 million yuan for the month, and the applicable Business Tax rate is 3%.

Tax payable = 2 million yuan × 3% = 60,000 yuan

Example B

A dancing hall has a turnover of 600,000 yuan for the month, and the local applicable Business Tax rate is 20%.

Tax payable = 600,000 × 20% = 120,000 yuan

Determining Turnover

Usually, the turnover is composed of the total consideration and all other charges received (e.g., commissions, funds, the pooling of funds, payments received/made on behalf of others) from the buyers for the provision of taxable services, the transfer of intangible assets, and/or sales of immovable properties by the taxpayers.

However, some expenses can be deducted under certain situations, as described below:

Transportation

  • For transportation enterprises that carry passengers or cargo out of China, and that subcontract the passengers or cargo to other transportation enterprises overseas, the turnover shall be the balance of the revenue earned after deducting the freight charges paid to the other transportation enterprises overseas, from the freight charges for the whole journey.
  • For transportation enterprises engaged in transit transportation, the turnover shall be the balance of the revenue earned after deducting freight and loading/unloading charges paid to other carriers.
  • Where the local tax bureaus approve the use of transportation enterprise invoices, and where the units paying Business Tax under the transportation category offer the transportation business to other transportation enterprises and receive the price payments uniformly, the turnover shall be the balance of the revenue earned after deducting the freight paid to the other transportation enterprises, from the total price payments received by the units.

Travel

  • For travel enterprises that organize group tours outside China, and that subcontract to other travel enterprises overseas, the turnover shall be the balance of the revenue earned after deducting payments made to the subcontracting travel enterprises, from the tour charges for the whole journey.
  • For travel enterprises that organize group tours within China, the turnover shall be the balance of the revenue earned after deducting payments for housing, meals, travels, and tickets made to other units or other travel enterprises on behalf of the tourists, from the tour charges received from the tourists for the whole journey.

Finance and Insurance

  • For foreign-exchange re-lending businesses, the turnover shall be the interest earned on lending less the interest earned on borrowing.
  • For banks and non-bank financial institutions that buy and sell foreign currencies, marketable securities or non-commodity futures, the turnover shall be the selling price less the buying price.

    Under financial accounting rules, the buying price for shares or bonds bought by financial enterprises is deemed to be the purchase price of the shares or bonds less the dividend income received during the time the shares or bonds were held.

    For the buying and selling of shares, bonds, foreign currencies, or other financial products, the financial enterprises may compute and pay the tax by consolidating annually the positive and negative balances for different tax periods, at the end of the accounting year.

    If the tax payable thus computed is less than the tax already paid during the year, the enterprises may apply to the tax department for a tax rebate. However, any negative balance after the annual consolidation cannot be carried forward to the subsequent year.

  • For insurers within China that re-insure the insurance business with overseas insurers, the turnover shall be the total insurance premiums received less the premiums paid to the overseas insurers. The overseas insurers shall pay the tax on the premiums, and the tax shall be withheld by the domestic insurers.
  • For financial leasing units sanctioned by the People's Bank of China or other competent departments of the State to engage in financial leasing businesses, the turnover shall be the balance of the revenue earned after deducting costs incured by the lessors in the course of leasing (e.g., the purchase price of the goods, Customs duty, VAT, Consumption Tax, freight charges, installation charges, insurance premiums, interest on loans), from the total price and surcharges (including the residual value) received from the lessees.
  • For financial enterprises delegated to collect payments (e.g., telephone fees, water charges, electricity charges, gas charges, tuition fees, insurance premiums, taxes), the turnover shall be the total receipts less the sum paid to the delegated party.
  • For those who receive the following charges, the monitoring or administrative charges received by the securities exchange or futures trading markets in accordance with the prevailing regulations, and any relevant expenses paid to the securities or futures trading companies may be deducted from the turnover.
  • For financial enterprises already paying tax on loans for which the principal sums that have not been recovered within the accounting time limit specified under financial accounting rules, the interest receivable may be deducted from the turnover later.

    Any interest receivable already offset and recovered after deduction of interest as bad debt should be included in the turnover for the current tax payment period.

  • For insurance enterprises already paying tax on insurance premiums that have not been recovered within the accounting time limits specified under financial accounting rules, the insurance premiums receivable may be deducted from the turnover.

    Premiums receivable already offset and recovered after deduction as bad debt should be included in the turnover for the period.

  • Where insurance enterprises with a pricing policy for policy holders who have not made any claims, the turnover shall be the premiums actually received from the policy holders.

Construction

  • For prime contractors in the construction business that subcontract work to others, the turnover shall be the total contract sum less payments made to the subcontractors.
  • For installation and construction engineering enterprises, the turnover does not include the value of the equipment. What specifically constitutes these equipment will be decided by the SAT and the local tax bureaus at the provincial level.

Sale of Immovable Property

  • For units and individuals that sell immovable property they have acquired, or that transfer land-use rights they have obtained by transfer, the turnover shall be the balance of the proceeds earned after deducting the original value of the immovable property or the land-use rights, from the total sales revenue or the transfer proceeds.
  • For units and individuals that sell immovable property obtained as debt payments, or that transfer land-use rights obtained as debt payments, the turnover shall be the balance of the proceeds earned after deducting the assessed value of the immovable property or the land-use rights, from the total sales revenue or the transfer proceeds.

Services

  • For agency businesses, the turnover shall be the considerations received from the principals for the businesses.
  • For advertisement agencies, the turnover shall be the total considerations less the advertisement announcement expenses paid to the advertisement companies or the advertisement announcers.

Others

  • Where labor companies are delegated by the employing units to arrange for labor forces, and the units hand over the wages, as well as the social insurance and the house reserves, to the labor companies for payment on behalf of the units, the turnover shall be the total receipts from the units less the wages paid to the labor forces, as well as the social insurance premiums and house reserves paid on behalf of the labor forces.
  • For entertainment performances organized by units or individuals, the turnover shall be the balance of the proceeds received after deducting payments to the relevant units and brokers, from the total box-office proceeds or block-booking proceeds.
  • For postal and telecommunications units that cooperate with other units to provide postal and telecommunications services to the users, and that receive the charges uniformly, the turnover shall be the total receipts of the postal and telecommunications units less payments to the cooperating parties.
  • For realty management units, the turnover shall be the balance of the proceeds earned after deducting expenses on utilities (water, electricity, gas) paid on behalf of the owners, and expenses on utilities and rentals paid on behalf of the tenants, from the relevant total receipts to the realty management units.
  • Other situations: As stipulated by the Ministry of Finance.

Supporting Documentation

Where payments for deductible items are made in China, the claim must be supported by invoices or other legal valid documents. In the case of payments made overseas, the claim must be supported by vouchers for foreign-exchange payments, receipts signed by the foreign companies, or notarized documents.

Exchange Rate Conversions

The turnover shall be computed in yuan. For turnover settled in foreign currencies, the amounts should be converted into yuan at the State's official exchange rate quoted on the day of settlement, or on the first day of the same month by the People's Bank of China (or at the exchange rate derived in accordance with the relevant regulations).

For financial enterprises settling turnover in foreign currencies, the conversion should be made at the exchange rate quoted on the day the foreign currency was received, or at the exchange rate quoted at the end of the same quarter by the People's Bank of China.

For insurance enterprises settling turnover in foreign currencies, the conversion should be made at the exchange rate quoted on the day the foreign currency was received, or at the exchange rate quoted at the end of the same month by the People's Bank of China.

Taxpayers should determine in advance the conversion method to be adopted. Once it has been determined, no change shall be allowed within one year.

Deemed Turnover

Where taxpayers provide taxable services, transfer intangible assets, or sell immovable properties at prices that are noticeably low, and the taxpayers can offer no acceptable reason, the relevant tax departments shall assess the turnover based on the average prices used by the taxpayers to provide similar taxable services, transfer intangible assets, or sell similar immovable properties in the current month or in recent periods, or based on composite prices (cost plus certain profits).

Composite price = ({Business cost or engineering cost} × {1 + Cost-to-profit ratio}) ÷ (1 − Applicable tax rate)

The cost-to-profit ratio is decided by the local tax bureaus at the provincial level. For example, Beijing stipulates a ratio of 20% for entertainment businesses, the transfer of intangible assets, and sales of immovable property, and 5% for other taxable items.

In the case of payments returned after the provision of taxable services, transfer of intangible assets, or sale of immovable property, for which the tax has already been levied, the tax may be returned or may be offset against the tax payable later.

TAX REDUCTIONS AND EXEMPTIONS

Certain categories of income, activities, and enterprises may be exempt from Business Tax.

  • Nursing services provided by nurseries; kindergartens; homes for the aged; welfare institutions for the handicapped; matchmaking services; and funeral services.
  • Services provided by the disabled on an individual basis.
  • Medical services income earned in accordance with State-specified prices by non-profit medical institutions, disease control institutions, and women's and children's health institutions.

    Medical services income earned by profit-making medical institutions may be exempt for 3 years, starting from the date the institutions obtain their business licenses, if they use the income directly to improve medical and health conditions.

  • Educational services provided by schools and other educational institutions; services provided by students participating in part-time work; and advanced study courses and training courses organized by public high/middle/primary schools if all the income earned belongs to the schools.
  • Agricultural mechanical ploughing, irrigation and drainage; the prevention and treatment of plant diseases and insect pests; plant protection; insurance for farming; animal husbandry and related technical training services; and the breeding of poultry, livestock and aquatic animals, and the prevention/treatment of diseases in such animals.
  • Admission fees (i.e., the first gate charges) for cultural activities conducted by memorial halls, museums, cultural centers, art galleries, exhibition halls, academies of painting and calligraphy, and library and cultural protective units; admission fees for cultural and religious activities conducted at places of religious worship; admission fees for science and technology halls, planetariums and meteorological observatories, seismograph stations, the science bases of universities and research institutions that are open to the public; and admission fees for popular science activities held by the party or governmental departments above the county level and science associations.
  • Release income earned by film distribution units from cinemas.
  • Insurance premiums derived from insurance businesses such as ordinary life insurance, annuities, and health insurance where policies have been taken out on a one-year basis or longer, and where the principal and interest are paid back at maturity; and other forms of ordinary life insurance, annuities, and health insurance that have been approved for tax exemption by the Ministry of Finance and the SAT.
  • Income derived from the transfer of copyright by individuals.
  • Income derived from the transfer of technology, technology development, or relevant technical services and technology consultation services by units and individuals; and income derived from technology transferred by foreign enterprises and foreigners into China.
  • The transfer of land-use rights to farmers for agricultural production.
  • Interest on State loans for the support of education.
  • Administrative charges and funds included in the financial budget management or the management of special financial accounts, where approval has been obtained by the financial department at the central and provincial levels.
  • Ordinary residential buildings acquired and lived in for more than one year by individuals, and residences self-constructed for self-use by individuals, may be granted tax exemption at the time of sale.

    Temporary tax exemptions may be granted for revenue derived from the sale of residences at house-reform cost prices or standard prices by enterprises, institutional units and administrative units, and on rental income from house properties vacated by the army and then rented out.

  • Rental income from the leasing of residential houses priced by the government, and from low-rental houses is exempt from tax.

    The renting out of private houses at market rates is provisionally taxed at 3%.

  • Union dues charged by non-profit social organizations (e.g., associations, institutes, joint societies, research institutes, funds) approved for establishment within China by competent departments of the State in charge of social organizations, if the charges are in line with the standards specified by the Ministry of Finance or the department of civil affairs.

    Party fees, union fees, and league fees charged by various parties, unions, youth leagues, or women's associations may be exempt from the tax if the charges are in line with the standards specified by the Ministry of Finance or the department of civil affairs.

  • Where new services enterprises (excluding those involved in advertisements, saunas, massage parlors, Internet cafes, or oxygen bars employ newly laid-off persons, and these persons represent 30% or more of the total employees in the current year, and where the enterprises sign employment contracts lasting three years or more with these persons, upon verification by the labor department, the enterprises may be exempt for tax for three years after examination by the tax department.

    Laid-off persons engaged in individual household businesses (excluding those involved in construction, entertainment and advertising, saunas, massage parlors, Internet cafes, or oxygen bars that employ not more than seven staff may be free from tax for three years, starting from the date they receive their tax registration certificates. Those employing eight persons or more shall be treated as new services enterprises, as described above.

  • Periodic tax exemptions may be granted for business revenue derived from the provision of community services by individual industrial and commercial households.
  • Civil welfare enterprises engaged in the services industry (excluding advertising businesses) that employ the disabled, and whose disabled staff comprise more than 35% of the total staff, may receive temporary exemptions.
  • No Business Tax is imposed on loans made by the People's Bank of China to financial institutions; the interest revenue derived from the use or borrowing of funds by intra-financial institutions; the interest income of units and individuals earned from savings in financial institutions; insurance provided by insurance institutions within China for exported goods; export credit insurance offered by approved financial and insurance enterprises; indemnity payments pursued back by insurance companies; foreign exchange, marketable securities, securities investment funds, and non-goods futures purchased and sold by non-financial institutions and individuals; funds pooling conducted through the issuance of securities investment funds; revenue derived by welfare lottery institutions from the issuance of welfare lottery tickets; and the special house repair funds collected by the house management department or the institutions appointed by the department, the public house reserve administration center, development enterprises, and house management units.
  • Individual taxpayers whose sales volumes do not reach the sales thresholds specified by the Ministry of Finance shall be exempt from tax.

    Under the current rules, the sales threshold is 1,000–5,000 yuan per month when tax payments are made over a certain period; and 100 yuan at each instance or per day when tax payments are made at each instance or per day.

    Local tax bureaus at the provincial level may determine the thresholds for their own jurisdictions after taking into consideration local conditions, as long as the thresholds they set fall within the ranges prescribed above. For example, the Beijing Local Tax Bureau stipulates that the threshold for payments per month is 5,000 yuan of turnover per month. The Jiangxi Provincial Local Tax Bureau rules that, for payments made over a certain period, the threshold of turnover is 2,000 yuan for cities, 1,500 yuan for counties and towns, and 1,000 yuan for the countryside.

  • Tax on airport construction fees may be collected first, and then rebated for airport construction.

Other tax reductions and exemptions must be sanctioned by the State Council.

Where taxpayers deal in both tax-exempt items and tax reduction items, they should calculate separately turnover for the tax-exempt items and tax reduction items. Otherwise, the tax department will not entertain any of their claims for tax exemptions or reductions.

LIABILITY, TIME LIMIT, AND PLACE FOR TAX PAYMENT

Liability for Payment

In general, liability to pay Business Tax arises on the date the business proceeds are received by the taxpayer, or documented evidence of the right to collect the business proceeds is obtained by the taxpayer. Certain variations are listed below:

  • For taxpayers that provide taxable services, that transfer patents, non-patent technology, trademarks, copyright and goodwill, or that receive advance payments (e.g., pre-collections, prepayments, pre-deposited expenses, pre-charged downpayments) from their counterparts, liability arises when the payment is confirmed as revenue realization in accordance with accounting rules.
  • For taxpayers that transfer land-use rights or that sell immovable properties by accepting payments in advance, liability arises when the advance payment is received.
  • For taxpayers that gift immovable properties to others, liability arises when the titles of the immovable properties are transferred.

Withholding liability for Business Tax arises on the date the business proceeds are received by the withholding agents on the taxpayers' behalf, or on the date documented evidence of the right to collect business proceeds is obtained by the withholding agents on the taxpayers' behalf.

Time Limits for Payment

The assessable period may be 5 days, 10 days, 15 days, or 1 month. The actual length is determined by the relevant tax authorities based on the quantum of the tax payable.

Banks, financial companies, trust investment companies, and credit firms are assessed on a quarterly basis. Other financial institutions are assessed on a monthly basis.

Where payment cannot be made following the specified periods, tax can be assessed and paid on a transaction-by-transaction basis.

Taxpayers whose assessable period is 1 month shall report and pay tax within 10 days of the end of the period.

Taxpayers whose assessable period is 5 days, 10 days, or 15 days shall prepay the tax within 5 days of the end of the period. They shall also file a monthly tax return for settling the tax for the previous month within the first 10 days of the following month.

Financial institutions shall report and pay tax within 10 days of the end of the period.

Tax payment deadlines for withholding agents shall be determined with reference to the stipulations described above.

Places for Payment

  • Taxpayers that provide taxable services shall report and pay tax to the relevant tax offices in the locales where the services take place.
  • Taxpayers engaged in the transportation business should report and pay tax to the relevant tax offices in the locales where their business establishments are situated.

    Individual business operators shall report and pay tax to the relevant tax offices in the locales where they are registered or where they reside.

    For central railway transportation enterprises, taxes shall be paid on a consolidated basis by the Ministry of Railway in Beijing.

  • Taxpayers that provide taxable services in another county/city should make up taxes not paid at the relevant tax offices in the locales where their establishments or residences are situated if they fail to report and pay tax as they should to the relevant tax offices in the locales where the services take place.
  • Taxpayers that transfer land-use rights shall report and pay tax to the relevant tax offices in the locales where the land is situated.

    Taxpayers that transfer other intangible assets shall report and pay tax to the relevant tax offices in the locales where their establishments are situated.

  • Taxpayers that sell immovable properties shall report and pay tax to the relevant tax offices in the locales where the immovable properties are situated.
  • Taxpayers that lease out land-use rights or immovable property shall report and pay tax to the relevant tax offices in the locales where the land or the immovable property is situated.

    Those leasing out materials or equipment shall report and pay tax to the relevant tax offices in the locales where the movable property is situated.

  • Taxpayers that fall into the following categories shall report and pay tax to the relevant tax offices in the locales where their institutions are situated:
    • Telecommunications units that conduct telecommunications business activities within China.
    • Units that provide design, engineering monitoring, testing, and consultation services within China.
    • Units that provide training, information, long-distance testing, and monitoring services within China to other units and individuals via networks.
  • For taxpayers conducting taxable activities within their own province/autonomous region/municipality directly under the State Council, any changes to their tax payment locales shall be determined by the local tax bureaus at the provincial level.
  • Taxpayers with contracted projects across provinces/autonomous regions/municipalities directly under the State Council shall report and pay tax to the relevant tax offices in the locales where the establishments are situated.
  • Tax payable by the head offices of the People's Bank of China, the Industrial and Commercial Bank of China, China Agricultural Bank, the Bank of China, China Construction Bank, and the State Development Bank shall be paid to the tax authorities at the locales where the head offices are situated. Subsidiaries of the banks listed above, and other banks and financial institutions shall pay tax to the relevant tax offices in the locales where they are situated.
  • Withholding agents shall report and pay tax withheld to the relevant tax offices in the locales where their institutions are situated.
  • Prime contractors of construction and installation projects shall handover tax withheld from the non-cross province subcontractors to the relevant tax offices in the locales where the subcontracting service occurs.