China VAT Reform-shifting to higher gears by dtt.pdf

Asia Pacific Dbriefs Presents: China Spotlight . China VAT Reform: Shifting to Higher Gears Robert Tsang / Sarah Chin / Li Qun Gao 29 January 2013 Agenda • Asia Pacific context – VAT reform the Indirect Tax trend of the decade? • China VAT reform – highlights, case studies, and prospects • Take-aways: what should you do? • Questions Answers 2 © 2013 Deloitte Global Services Limited Asia Pacific – VAT reform the Indirect Tax trend of the decade? Asia Pacific Indirect Tax trends • Change, change, and more change: not just in China, but also India, Malaysia, and other countries in the midst of changing to a unified VAT system • Significant differences in Indirect Tax rules country to country in Asia Pacific, but most MNCs have common financial systems for dealing with VAT, Business Tax, GST, Service Tax, Sales Tax and the like • Move towards compliance assurance: the Australian and Singapore experiences • Planning and managing Indirect Tax across the region is starting to be an imperative for many businesses operating in the region 4 © 2013 Deloitte Global Services Limited Polling question 1 Does your business in Asia: (Please select all that apply) • Involve a business, supplier, or customer in China? • Concern supplies of goods • Countenance supplies of services • Encompass some form of RD activity • Have any form of cost sharing arrangements • Not applicable 5 © 2013 Deloitte Global Services Limited China VAT reform – highlights and prospects China VAT reform • China has launched the VAT reform with the aim to convert the items which are subject to business tax to VAT with Shanghai as the first pilot city and selected service sectors since 1 January 2012 • The current pilot scope includes ‒ Tran