News
China is set to expand the scope of its pilot value-added tax (VAT) program to railway transport and postal services starting on January 1, 2014, according to the nation's Ministry of Finance said Friday.
VAT is levied on the difference between the cost of production and the price of a commodity in the market, replacing the existing business tax. The VAT reform started in Shanghai last year and has been expanded to other provinces an cities.
Effective January 1, railway and postal service companies will be required to pay an 11 percent VAT for the value-added portion of sales.
With the rail sector to be subject to VAT, all of China's transportation sectors will have been included in the VAT reform.
