Chinese VAT rates

The standard rate of VAT is 13%. Following the 2012-16 VAT reforms, there are only four VAT rates in China, plus nil rating.

There are other taxes, including Business Tax (3% to 20%) on services. For small entrepreneurs, the VAT rate applicable is 3% with limits on VAT deductions.

China VAT rates

Rate Type Which goods or services
13% Standard All other taxable goods and services
9% Standard Retail; entertainment; hotel; restaurants; catering services; real estate and construction, telephony calls; postal; transport and logistic
6% Standard Financial services and insurance; telephony and internet data; IT; technology; consulting
3%   Chinese National Education Tax
2%   Chinese Local Education Taxes
6%   City Maintance & Construction
3%   Construction services
1%-56% Luxury Consumption tax applies to prescribed nonessential and luxury or resource-intensive goods (including alcohol, luxury cosmetics, fuel oil, jewellery, motorcycles, motor vehicles, petrol, yachts, golf products, luxury watches, disposable wood chopsticks, tobacco, certain cell and coating products), and it mainly affects companies involved in producing or importing these goods. The tax is calculated based on the sales value of the goods, the sales volume or a combination of the two. The proportional consumption tax rate is from 1% to 56% on the sales revenue of the goods. Exports are exempt.

In addition to VAT, there are a range of other indirect taxes, including:

  • Stamp Duty
  • Customs Duty on imports and luxury goods
  • City Construction and Maintenance Levy
  • National Education Tax
  • Local Education Tax

Unraveling the mysteries of Chinese VAT

Webinar: Unraveling the mysteries of Chinese VAT

Join Avalara and KPMG as we review China’s VAT system and how it differs to common VAT systems around the world. 


Latest Chinese news

China VAT cut to 13% on tariffs concerns

Mar 4, 2019

China is to cut its standard VAT rate from 16%  to 13% in 2019 to help its manufacturers struggling with US tariffs, slowing global demand and a domestic debt overhang.  

China raises VAT registration threshold

January 14, 2019

China has raised its VAT registration threshold from 1 January 2019 from CNY30,000 to CNY100,000 for small businesses. The measure is temporary for the next two years.

 

China extends e-commerce VAT concessions

November 28,2018

The Chinese State Council has extended the current VAT discount and duty exemption for small value e-commerce imports to consumers.