Revised PRC <Foreign Trading Law> ( "FTL") has been executed since July, July 1, 2004. As a continuum of the well implementation of FTL, Circular No. 955 (2004) (hereinafter referred to as ¡°Circular¡±) was issued to deal with the following related problems of the export value-added tax (¡°VAT¡±) refund and exemption measures to better accommodate the revised FTL:
Please note that there is no requirement for Traders who have already obtained an export VAT refund registration certificate before the issuance of this Circular to go through the above application procedures. However, Trades who are operating outside of its approved business scope of activities are required to apply for the export VAT refund or exemption confirmation by applying the above procedures.
When a change occurred in the structure of the Traders, such as dissolution or merger or any other changes; the Traders must proceed to the local tax authorities to apply for modification on its export VAT refund and exemption assessment method within 30 days from the date when the modification in the file registration is made.
Accordingly, prior regulations regarding the registration for export VAT refund promulgated in Circular No. 031 (1994) <Export VAT Refund and Exemption Measures> are deemed to be ineffective upon the issuance of this Circular.
2. In order to enjoy export VAT refund and exemptions, Traders should only use the name registered in the export VAT refund and exemption registration file to conduct export transactions.
3. For manufacturing Traders who are permitted to export its self-manufactured products, their export VAT refund and exemption method should be applied in accordance to current export tax regulations for manufacturing company, which is export VAT ¡°exemption, offset, and refund¡± method.
For non-manufacturing Traders, their export VAT refund and exemption method should be applied in accordance to current export VAT refund and exemption measures for foreign trading entities.
For Traders who are deemed small-sized VAT taxpayers, their export VAT refund and exemption method should be applied in accordance to current export tax regulations for small-sized taxpayers, that is to be exempted from both VAT and consumption tax.
4. Foreign trading entities that purchase export goods directly from intermediary trading entities should apply their export VAT refund and exemption method in accordance to current export VAT application procedures.
For manufacturing entities that were selected to be experimental targets for export VAT tax refund system, their export VAT refund and exemption method should be applied in accordance to current export tax regulations for manufacturing company, which is export VAT ¡°exemption, offset, and refund¡± method.
For manufacturing entities that were not selected to be experimental targets for export VAT tax refund system, its permitted scope of export VAT refunds should be made according to the regulations promulgated in Circular No. 1170 (2002) <Export VAT refund on export goods deemed to be self-manufactured>.
5. This Circular is effective from July 1 st , 2004, with the exception of Article 4 of this Circular, which is effective June 1 st , 2004. The ¡°goods exported date¡± marked on the export goods customs declaration form is deemed to be the effective date.
