Economic Information Daily reported that real estate and construction may implement a reform from a business tax to a value added tax.
The State Council set forth the goal that the reform from the business tax to the value added tax should be completed by the end of the 12th five plan period, which is 2011 to 2015. With one year left, the value added tax may be put in place in real estate and construction starting as early as next March. It is anticipated that the tax rate will be 11 percent. Based on preliminary estimates, analysts predict that the reduction in taxes may reach 500 billion yuan. For most companies, implementation of the valued added tax means that accounting and taxation need to be handled by two separate departments, rather than the current practice of using one department.
Source: Economic Information Daily reprinted by People’s Daily, December 8, 2014 http://politics.people.com.cn/n/2014/1208/c70731-26164819.html