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October 18, 2013
Are you ready for China’s new VAT tax program?
By The Ataway News Team
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On August 1st, China began implementing its new VAT tax program on a national scale. The program, which has already been successfully piloted in many of China’s major cities, is aiming to transition Mainland China to one universal tax system. The previous tax system was an exclusive dual tax program that used both a business tax (BT) and a VAT tax. The goal of the new VAT program is to eliminate the current double taxation system and unify China under a singular sales tax law. The ultimate goal of the tax reform is to facilitate the development of service sectors and achieve a desirable industrial structure.

What these changes could mean for your business      

Ultimately, the new universal VAT tax system will be beneficial for most companies. The VAT system will cut down on many of the complexities and problems that occur as a result of the current dual tax system. It will be particularly helpful in eliminating problems for those doing business in differing Chinese cities that are subject to different BT and VAT tax laws. However, in the short term the transitional period of the new tax reform may prove costly for those not ready. For those business affected, the reform will have substantial implications. Some of these changes will include new tax rates, the need to changeover to new accounting systems, and increased complexity of measuring the VAT. With the repetition involved in the VAT tax system, a small error could prove costly.

The change will most likely impact the setup of your PeopleSoft Global Options and Reports. Products impacted by the tax program include PeopleSoft BillingPurchasingPayablesExpensesCash  MangementReceivableseProcurementGeneral Ledger and Asset Lifecycle Management.

With years of experience in China, Ataway can ensure that your business  will be prepared for the new tax law changes.  

Consult with Ataway’s Team of Experts today, and learn how we can provide Solutions for your business in compliance with any Local Statutory Requirement.

[Image via http://www.flickr.com/photos/44534236@N00/7553666024/]

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