The end of the national treatment for foreign capital and tax

Our correspondent Li Lihui the State Council that, since December 1, 2010, China will unify the urban maintenance and construction tax and education fees attached to foreign-invested enterprises, foreign enterprises and foreign individuals to levy urban maintenance and construction tax and education fees attached.　　So far, the tax system of foreign-funded enterprises has been fully unified, and the "supranational treatment" enjoyed by foreign enterprises in tax policy has been completely terminated. "Internal and external", in the early period of reform and opening up has a positive significance review of the original "internal and external" tax system, the Chinese Academy of Social Sciences, the Deputy director of Gao Peiyong is quite sentimental.　　He said that domestic and foreign enterprises to implement different tax system, and to give foreign-funded enterprises preferential treatment of domestic companies, has been as an important policy to attract foreign investment in the early stage of reform and opening up in China for many years. To sum up, this kind of internal and external tax system, roughly related to enterprise income tax and foreign investment enterprises and foreign enterprises income tax, travel and travel use tax and vehicle use licence tax, real estate tax and urban real estate tax, urban maintenance and construction tax, land use tax and education fees attached several tax (fees) kinds.　　In the early stage of reform and opening-up, this "internal and external" tax system has played an important role in attracting foreign capital and introducing advanced technology abroad. However, with the deepening of China's reform and opening up, this tax system is increasingly inconsistent with the demand for fair competition in market economy, the contradictions are increasingly prominent, the community calls for the unification of the tax system of foreign-funded enterprises more and more strong. Since 1994, the NPC and the State Council have embarked on a gradual unification of the tax system for foreign-funded enterprises.　　In our current tax system, value added tax, consumption tax, business tax, Enterprise income tax, urban land use tax, travel tax, farmland occupation tax and real estate tax have been unified, and the system of urban maintenance and construction tax and education fee attaching is still different. Who benefits who the burden is fair and reasonable Gao Peiyong said that the urban maintenance and construction tax is a specific purpose tax, introduced in 1985. It is a tax levied by the state to strengthen the maintenance and construction of the city, and to enlarge and stabilize the source of the urban maintenance and construction funds. Education fees attached to the special charges, in 1986 levy. It is a kind of charge levied by the government to quicken the development of local education and expand the source of local education funds. The tax of urban maintenance and construction and education fees are based on the actual tax paid by VAT, excise tax and business tax (product tax, VAT, business tax before 1994).　　Urban maintenance and construction tax according to the location of the taxpayer for the urban area, county (town) and other areas, according to 7%, 5%, 1% of the three file tax rates, education costs attached to the current uniform by the ratio of 3% levy.　　These two kinds of taxes (fees) have a common characteristic, is according to WHO benefit who bear the principle of jurisprudence, in the domestic engaged in production and operation and directly or indirectly enjoy the city construction and the results of China's education enterprises and individuals levy. Gao Peiyong that, from the original intention of levying the two kinds of taxes (fees), the foreign-funded enterprises enjoy the city baseInfrastructure construction and education and other public resources, on the other hand, these enterprises have not fulfilled the obligation to pay tariffs (fees), which is not in any way to make sense.　　The "supranational treatment" policy accorded to foreign-funded enterprises is in fact a kind of discrimination against domestic companies, and has produced the effect of inhibiting the development of domestic enterprises. "Internal and external integration", will not have negative impact on attracting foreign investment the Ministry of Finance officials pointed out that the unification of all types of enterprise tax system is a fair tax burden, the inevitable demand for fair competition. With the development of China's economy and society and the continuous improvement of market economy system, it will aggravate the unfair competition between domestic and foreign enterprises and not to improve the competitiveness of domestic enterprises. At present, the time is ripe for unifying the urban maintenance and construction tax and the education fee additional system of the foreign-funded enterprises.　　The imposition of urban maintenance and construction taxes and education fees on foreign-funded enterprises is conducive to creating a fair and competitive tax environment for all types of businesses. The official said China's social stability, the economy is in a high-speed growth period, a vast consumer market, rich labor resources, at the same time, our government has long been committed to foreign investors to create a more open, fairer, more convenient and more friendly investment environment, formed a full range, wide field, multi-level open to the pattern, Many favorable factors have strong attraction to foreign capital. Therefore, the imposition of urban maintenance and construction tax and education fees on foreign-funded enterprises will not have negative impact on China's attracting foreign investment.　　Moreover, the levy of urban maintenance and construction tax and education fees for foreign-funded enterprises is not intended to increase the burden of foreign-funded enterprises, but to establish a tax mechanism and investment environment conducive to fair competition. The abolition of "preferential treatment" is for the sake of fair competition Shambo with the beginning of December 1, the imposition of urban maintenance and construction tax and education fees on foreign-funded enterprises, foreign enterprises and foreign individuals in China will completely end the "preferential treatment" of the foreign-owned enterprises in the tax system and achieve a comprehensive unification of the　　This will help to perfect the fair competition tax mechanism and investment environment. At the beginning of reform and opening up, China has issued a number of tax incentives for foreign enterprises, such as "two free three minus", to attract foreign investment and the introduction of foreign advanced technology has played an important role. However, with the deepening of reform and opening up, the unification of all kinds of enterprise tax system is a fair tax burden, promoting the fair competition in line with market economy inevitable trend.　　To realize the equal competition of the foreign-owned enterprises under the same tax burden embodies the principle of national treatment in the international economic exchange and cooperation. It has been proved that the tax level of the foreign-funded enterprises not only hinders the inflow of foreign capital, but improves the investment environment of China, and the overall function of foreign capital to promote economic and social development is better played. Compared to the levy of the two lower taxes, the previous 2007 years, the unification of foreign enterprises income tax, did not cause the decline of foreign investment. China's foreign direct investment in the global rankings from the end of the fourth place to the current second, and 18 consecutive years in the developing countriesFirst。　　It is believed that with the transformation of the mode of economic development and the expansion of domestic demand, foreign-funded enterprises with capital, technology and management advantages will gain greater space for development in the future.　　The unification of tax system in foreign-owned enterprises from January 1, 1994 onwards, foreign-funded enterprises and foreign enterprises began to apply China's unified value-added tax, consumption tax and business tax management regulations.　　December 2006, the new revised "Urban land Use tax interim regulations" for the first time to foreign-invested enterprises and foreign enterprises levy urban land use tax.　　January 1, 2007, the new "Temporary regulations on vehicle and travel tax" began to be implemented, the use of travel licence and travel tax combined with the travel tax, uniform applicable to all types of taxpayers. The Enterprise Income Tax Act of March 2007 promulgated and unified the income tax system of domestic and foreign enterprises. The income tax rate of the foreign-funded enterprises is 25%.　　Previously, the income tax rate of foreign-funded enterprises was 15%, the joint venture was 17%, while the domestic enterprise was 33%.　　January 1, 2008, the implementation of the "Enterprise Income Tax Law implementation regulations", unified the domestic and foreign enterprises of the wage and salary expenditure before tax deduction policy.　　January 1, 2008, the implementation of the "Land occupation tax interim", in the scope of the relevant provisions of the taxpayer to increase foreign-funded enterprises and foreign enterprises. From January 1, 2009 onwards, foreign-funded enterprises, foreign enterprises and organizations and foreign individuals, including Taiwan-funded enterprises and organizations, as well as overseas Chinese, Hong Kong, Macao compatriots, will be in accordance with China's "real estate tax interim regulations" to pay the real estate tax.