China Raises VAT and Business Tax Thresholds

(Beijing) – China's Ministry of Finance and the State Administration of Taxation raised minimum thresholds for China's value-added tax for businesses.

The threshold for the VAT on small enterprises based on monthly sales revenues will be raised between 5,000 and 20,000 yuan, up from the previous range of 2,000 to 5,000 yuan. The monthly business tax threshold was also raised to the same range as the VAT.

The adjustment will significantly cut taxes paid by private business owners according to Sun Gang, researcher at the Ministry of Finance Research Institute.