u Notice of Ministry of Finance and State Taxation Administration on Implementing the Inclusive Tax Deduction and Exemption Policy for Small and Micro Enterprises (Hereinafter referred to as the Notice)
The Notice was jointly formulated by the Ministry of Finance and the State Taxation Administration and was issued on January 17, 2019. It is effective during the period from January 1, 2019 to December 31, 2021. The main contents are as follows:
1. For small-scale VAT taxpayers with the monthly sales of less than 100,000 yuan (including this amount), VAT will be exempted.
2. Targeting at small-scale and low-profit enterprises, for the part of their annual taxable income that does not exceed 1 million yuan, only 25% of that part shall be counted as taxable income, and the enterprise income tax of that part shall be paid at the rate of 20%; for the part of their annual taxable income that is more than 1 million yuan but below 3 million yuan, only 50% of that part shall be counted as taxable income, and the enterprise income tax of that part shall be paid at the rate of 20%.
3. Small-scale and low-profit enterprises refer to these engaging in the national non-restricted and non-prohibited industries as well as complying with the following three conditions: (a) annual taxable income not exceeds 3 million yuan; (b) the number of employees is less than 300; and (c) the total assets not exceed 50 million yuan.
The implementation of the Notice will help to further reduce the tax burden of small and micro enterprises and support their development.
u Notice on Simplifying the Process of Enterprises Cancellation (Hereinafter referred to as the Notice)
In order to further promote the reform of the commercial system, solve the problem of “difficult cancellation of enterprises”, and provide more convenient services for enterprises to exit the market, the Notice was jointly issued on January 18, 2019 by five departments, i.e. the State Administration for Market Regulation, the Ministry of Human Resources and Social Security, the Ministry of Commerce, the General Administration of Customs, and the State Taxation Administration. Relevant facilitation measures are as follows:
a. reform and improve the enterprise cancellation system, further streamline the paperwork and optimize the process; b. strengthen information sharing and business collaboration, and promote online one-stop service; c. advocate categorized handling of tax cancellation to improve the speed of tax clearance; d. optimize the cancellation registration of social security, commerce, customs etc., so as to reduce the costs of enterprises; e. strengthen credit management and improve the joint disciplinary mechanism.
u Regulations on the Administration of Financial Information Services (hereinafter referred to as the Regulations)
The Regulations were enacted by the State Internet Information Office on December 26, 2018 and came into force on February 1, 2019, with main provisions as follows:
First, financial information service refers to providing information that may affect the financial market or providing services that may influence financial data, to users who are engaged in financial analysis, financial transactions, financial decisions or other financial activities. Second, a financial information service provider, if taking part in Internet information services or financial businesses that require legal permission or filing with authorities, should obtain the corresponding qualifications and be under the supervision of relevant departments; Third, the scope of information and content that financial information providers are prohibited to produce, copy, release, or disseminate is specified. Fourth, anyone who violates the provisions of Regulations shall assume legal liability.
The Regulations clearly states the requirements on content provided by financial information service institutions and their behaviors, which would strengthen content management and upgrade the quality of financial information services, so as to promote a healthy and orderly development of financial information services.
u Labor Law Tips - Is it necessary to pay normal salary to female employee on maternity leave?
In accordance with Chinese law, female employees on maternity leave still need to be paid as usual, and their social insurance and housing funds shall also be paid as usual. If the female employee has enrolled in maternity insurance, then the salary during maternity leave would be paid and borne by the local social insurance department as childbirth allowance. However, where childbirth allowance is lower than the normal salary of the female employee concerned, the employer shall be liable for such difference.
The formula for calculating childbirth allowance applied in Guangdong Province is: the average monthly salary during the year before the insured female employee gives birth or takes family planning operation of all employees in the related company (herein called “average monthly salary of last year”) ÷ 30 × prescribed maternity leave days. For employers who cannot calculate average monthly salary of last year, like a newly established company, the childbirth allowance shall be calculated based on the average monthly salary during the current year of all its employees.
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