Recently, the Ministry of Finance and the State Administration of Taxation announced to adjust the value-added tax (VAT) rate. The wine VAT rate will be adjusted from 17% to 16%, and the standard for small-scale taxpayers has also been adjusted. According to announcement, for those who have VAT taxable sales or importation of goods, where the original rate of 17% and 11% is applied, the tax rate shall be adjusted to 16% and 10% respectively since May 1st.
In item 54 of the various taxes announced, imported goods are also included. Calculated on the basis of a VAT of 16%, the combined tax rate for imported wines will be changed to 46.93%, compared to 48.2% previously. Insiders pointed out that wines from places such as Australia, Chile, New Zealand, and Georgia have lower tax rates because they have a free trade agreement with China.
In addition, in this new regulation, the provisions of the standards for small-scale taxpayers have also been revised: the annual sales standards to define small-scale industrial and commercial taxpayers have been raised from 500,000 yuan and 800,000 yuan respectively to 5 million yuan. Within a certain period of time, companies that have registered as general taxpayers are allowed to register as small-scale taxpayers. This will allow more companies to enjoy tax concessions. The adjustment of the VAT is an industry-wide general policy that not only gives the wine trader more room for commercial operations, but also helps the value of imported wines to rise again.
