China Tax Agency Announces Amendments to VAT Deduction Rules

The Chinese State Administration of Taxation Dec. 31, 2019, announced amendments to the rules for VAT deductions. The amendments include that: 1) a domestic subcontractor receiving payment from a domestic general contractor for an overseas construction project is presumed to have income from abroad and is therefore eligible for the VAT exemption for cross-border services; 2) the tax credit rating of a taxpayer may be applied to determine VAT and VAT withholding refund amounts; and 3) taxpayers with invoices issued on or before Dec. 31, 2016, which exceed the confirmation and certification deadlines but satisfy other criteria are still permitted ...