Interim Regulations of the People's Republic of China on Stamp Tax

Decree [1988] No.11 of the State Council August 6, 1988

Article 1 All units and individuals who execute or receive, within the territory of the People's Republic of China, documents in the categories specified in these Regulations shall be taxpayers subject to stamp tax (hereinafter referred to as "taxpayers"), and shall pay stamp tax in accordance with the provisions of these Regulations.

Article 2 The following categories of documents shall be taxable documents:

(1) contracts or documents in the nature of a contract with regard to: purchases and sales, the undertaking of processing, contracting for construction projects, property leasing, commodity transport, warehousing, loans, property, insurance, technology;

(2) documents for transfer of property rights;

(3) business account books;

(4) certificates evidencing rights or licences; and

(5) other documents that are taxable as determined by the Ministry of Finance.

Article 3 According to the nature of the taxable document, taxpayers shall calculate the amount of tax due on the basis of a flat tax rate or a fixed amount per document. Determination the specific tax rate or amount of tax shall be made with reference to the Schedule of Tax Items and Tax Rates accompanying these Regulations.

No stamp tax shall be due where the amount of tax payable does not exceed one jiao.

Where the amount of tax payable is one jiao or more, an odd amount not exceeding five fen shall not be counted; where the odd amount is five fen or more, the tax shall be calculated as one jiao.

Article 4 The following documents shall be exempt from stamp tax:

(1) duplicates or copies of documents on which stamp tax has already been paid;

(2) documents executed for the donation of property to the government, social welfare establishments or schools by the property owner;

(3) other documents which are exempt from stamp tax with the approval of the Ministry of Finance.

Article 5 Measures for the payment of stamp tax shall be implemented whereby taxpayers shall, in accordance with the provisions, calculate the amount of tax payable and purchase and affix at one time the full corresponding amount of tax stamps (hereinafter referred to as "stamping").

In order to simplify the stamping procedures where the amount of tax to be paid is relatively large or where frequent stamping is necessary, taxpayers may apply to the tax authorities to use a tax payment account instead of stamping, or a periodic payment method.

Article 6 "Fax stamps shall be affixed to taxable documents; taxpayers shall cancel each stamp along its border with a seal or a drawn line.

Tax stamps that have already been affixed may not be reused.

Article 7 Tax stamps shall be affixed to taxable documents at the time of execution or upon receipt.

Article 8 Where the same document is executed by two or more parties and each party holds a copy, each party shall be responsible for affixing on its own copy the full amount of tax stamps due.

Article 9 Where a document on which tax stamps have already been affixed is amended, resulting in an increase in the value thereof, additional tax stamps shall be affixed on the document in accordance with the amount of such increase.

Article 10 The tax authorities shall be responsible for the administration of the collection of stamp tax.

Article 11 The State Administration of Taxation shall supervise the printing of the tax stamps. The face value of tax stamps shall be denominated in Renminbi.

Article 12 Units issuing or processing taxable documents shall be responsible for the supervision to taxpayers in respect of the payment of stamp tax in accordance with the law.

Article 13 Where taxpayers are found to have engaged in any of the following, the tax authorities shall impose penalties in light of the seriousness of the case:

(1) in the case of a failure to affix tax stamps, or to affix an insufficient amount of tax stamps, on taxable documents, the tax authorities may, in addition to ordering taxpayers to make up the tax stamps, impose a fine equal to twenty times or less the amount of tax stamps due;

(2) in the case of a violation of the provisions of Paragraph 1 of Article 6 of these Regulations, the tax authorities may impose a fine equal to ten times or less the amount of the tax stamps that have not been cancelled by a seal or a drawn line; and

(3) in the case of a violation of the provisions of Paragraph 2 of Article 6 of these Regulations, the tax authorities may impose a fine equal to thirty times or less the amount of the tax stamps that have been reused.

In a case where tax stamps have been forged, the tax authorities shall submit the matter to the judicial authorities for investigation into criminal liability in accordance with the law.

Article 14 The collection and administration of stamp tax shall, in addition to the provisions of these Regulations, be administered in accordance with the pertinent provisions of the Interim Regulations of the People's Republic of China on Administration of Tax Collection.

Article 15 The Ministry of Finance shall be responsible for the interpretation of these Regulations. The rules for the implementation of these Regulations shall be formulated by the Ministry of Finance.

Article 16 These Regulations shall enter into force as of October 1, 1988.

Attachment:

Stamp Tax Schedule of Tax Items and Tax Rates

Promulgated by The State Council on 1988-8-6