China Tax Policies for Airplane Import by Lease Firms
[2014-06-18 10:40:19]
To local administrations concerned:
Upon approval by the State Council, from January 1, 2014, where a lease enterprise imports airplanes by ordinary trade and leases them to domestic airlines, the leaser may be given the same tax preferences as given to domestic airlines, i.e. the import value-added tax (VAT) may be reduced to the rate of 5% for the import of an airplane of 25-ton-or-more empty weight. Since January 1, 2014, where the import VAT has been levied at 17% on such airplanes, their tax paid in excess of the 5%-rated amount may be returned if their input VAT deductions have not been declared. When the leaser applies for the tax refund, it shall submit the certificate for input VAT payment without deduction, which shall be issued by its taxation authority.
As regards the lease enterprises located within customs supervision zones, such airplanes they import, which cannot be actually carried into the zones, shall be excluded from bonded import treatment and be subjected to the import VAT at the 5% rate.
Annex: Certificate for Input VAT Payment Without Deduction concerning the airplane import (omitted)
The Ministry of Finance of China
The General Administration of Customs of China
The State Administration of Taxation of China
May 13, 2014
Upon approval by the State Council, from January 1, 2014, where a lease enterprise imports airplanes by ordinary trade and leases them to domestic airlines, the leaser may be given the same tax preferences as given to domestic airlines, i.e. the import value-added tax (VAT) may be reduced to the rate of 5% for the import of an airplane of 25-ton-or-more empty weight. Since January 1, 2014, where the import VAT has been levied at 17% on such airplanes, their tax paid in excess of the 5%-rated amount may be returned if their input VAT deductions have not been declared. When the leaser applies for the tax refund, it shall submit the certificate for input VAT payment without deduction, which shall be issued by its taxation authority.
As regards the lease enterprises located within customs supervision zones, such airplanes they import, which cannot be actually carried into the zones, shall be excluded from bonded import treatment and be subjected to the import VAT at the 5% rate.
Annex: Certificate for Input VAT Payment Without Deduction concerning the airplane import (omitted)
The Ministry of Finance of China
The General Administration of Customs of China
The State Administration of Taxation of China
May 13, 2014
Source: ETCN
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