Industry | "Consumption Tax Law (Draft for Comment)" is here! Changes in paint taxation

After several reforms and improvements of the "Interim Regulations on Consumption Tax of the People's Republic of China", as well as long-term observation and investigation of factors such as economic development, industrial policy, industry development, and changes in residents' consumption levels, my country's second largest tax category-consumption tax With the latest news.
On December 3, the Ministry of Finance and the State Administration of Taxation jointly issued a notice to solicit public opinions on the "Consumption Tax Law of the People's Republic of China (Draft for Comment).
" The explanation of the "Draft for Comments" pointed out that the current consumption tax-related reform requirements have been implemented and the legislative conditions are mature.
The State Council will formulate implementing regulations in accordance with this law.
After the consumption tax law is formally implemented, the "Interim Regulations of the People's Republic of China on Consumption Tax" promulgated by the State Council on December 13, 1993 shall be repealed at the same time.
Consumption tax is an adjustment tax, which has an important adjustment function on production and consumption behavior.
The "Draft for Comments" released this time adjusted the scope, links, and tax rates of consumption tax, and included high-energy, high-polluting products and some high-end consumer goods into the scope of collection.
Consumer goods included in the tax collection include: tobacco, alcohol, high-end cosmetics, precious jewelry and jewellery, firecrackers and fireworks, refined oil, motorcycles, cars, golf and golf equipment, high-end watches, yachts, wooden disposable chopsticks , Solid wood flooring, batteries and paint, etc.
15 items.
 Among them, the paint tax is limited to the two links of production and import.
The objects of collection are mainly units and individuals who commission and import paint.
The consumption tax rate is 4%.
No consumption tax is levied on the wholesale and retail links of paint.
In other words, no consumption tax is levied on coating transportation companies, coating companies, and coating raw material manufacturers.
The reporter noticed that my country's first consumption tax levy regulation-the "Interim Regulations of the People's Republic of China on Consumption Tax" came into effect on January 1, 1994.
Since the start of the collection, consumption tax has undergone several major system adjustments, including the 2006 consumption tax system.
Reform, 2008 refined oil tax reform, a new round of consumption tax reform since 2014, etc.
In the 2014 consumption tax reform, paint was included in the taxation scope for the first time.
On January 26, 2015, the Ministry of Finance and the State Administration of Taxation jointly issued the "Notice on the Collection of Consumption Tax on Paints", requiring that consumption tax on coatings be levied on February 1, 2015, and collected during production, commissioned processing and import.
The applicable tax rate is 4%.
The "Notice" also specifically pointed out that paints with a volatile organic compound (VOC) content of less than 420 g/l (inclusive) under construction are exempt from consumption tax.
However, in the "Draft for Comments" released this time, there is no special provision for this.
The consumption tax on coatings was originally proposed by the Policy and Regulations Department of the Ministry of Environmental Protection.
The Ministry of Environmental Protection has been implementing environmental economic policies for several years.
Green taxation is part of the environmental economic policies.
As an industry closely related to the end market in the chemical industry chain, coatings cannot escape the fate of being "levied".
Regarding the consumption tax on coatings, some analysis pointed out that due to the dispersion of the coatings industry, the irregularity of production and the absence of supervision, the controllability of taxation is not strong, and the control is extremely difficult.
The result of taxation is only Taxes can be levied on a small number of large-scale and regulated companies, but it is difficult to levy a large number of non-standard companies.
As the taxation or not directly leads to a large cost difference, the competitiveness of regulated enterprises will decline, and they can only selectively withdraw from some markets and give way to those enterprises that have cost advantages due to non-taxation.
The result may be blocked or delayed.
The process of industry integration has given some large-scale, high-polluting enterprises more room for survival than before, and the industry has once again appeared in a state of greater chaos and disorder.
This result will not only fail to achieve the purpose of reducing emissions, but also May make emissions after taxation higher than before taxation.
 Therefore, it is recommended that while implementing the relevant regulations and regulations of consumption tax, the quality inspection, industry and commerce and taxation departments should strengthen the supervision of the test results, and strive for the authenticity and validity of the test results.
In addition, the "Consultation Draft" pointed out that the consumption tax shall be calculated based on ad valorem, specific, or compounded ad valorem and specific tax calculations.
Among them, taxable consumer goods such as coatings for entrusted processing shall be paid according to the sales price of the consignee’s similar consumer goods; if there is no sales price of similar consumer goods, the tax shall be calculated according to the composition taxable price.
Taxable consumer goods such as imported coatings are taxed based on the taxable composition price.
In order to implement the spirit of deepening the reform of “decentralization, regulation and service”, further reduce the frequency of taxpayers’ tax processing, and reduce the burden of taxpayers’ declarations, the "Draft for Comments" abolished the three tax calculation periods of “one, three and five days” and added The "half a year" tax calculation period.
Therefore, the tax calculation period for consumption tax is 10 days, 15 days, one month, one quarter, or half a year.
The deadline for this consultation is January 2, 2020.
Before that, the public can submit their opinions through the official website of the Ministry of Finance or by letter to jointly promote the improvement and formulation of the "Consumption Tax Law of the People's Republic of China.
" From the current point of view, the official promulgation of the "Consumption Tax Law of the People's Republic of China" is just around the corner.