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Issue 51-March 2021 Veritas Update
Release date:
2021-04-15

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Issue 51-March 2021 Veritas UpdateCATALOG


l   Latest Hot Spot

Li Keqiang hosted the State Council Executive Meeting, expected to new tax reductions over 550 billion


l   New Law Express

State Administration for market Regulation issued 'Measures for the Supervision and Administration of Online Transactions”



【Latest Hot Spot】


Li Keqiang hosted the State Council Executive Meeting, expected to new tax reductions over 550 billion

 

On March 31, Premier Li Keqiang presided over an executive meeting of the State Council, deploying tax cuts and fee reductions, and implementing and optimizing tax reduction policies for small and micro enterprises and individual entrepreneurs. This meeting is expected that the above policies, together with the tax incentives already in place, will result in an additional tax cut of more than RMB 550,000,000,000 for the year.

This meeting determined three new policies:

 1. Increase the income tax preferences for small and micro enterprises and include individual entrepreneurs into the scope of preferential policies. From January 1 this year to the end of next year, the annual taxable income of small and micro enterprises and individual entrepreneurs less than RMB 1,000,000 portion, on the basis of the existing preferential policies, could then reduce the income tax by half, further reducing the actual tax burden.


Previously, the effective tax burden of the annual taxable income less than RMB 1,000,000 portion of small and micro enterprises is as low as 5%, while under the above new policy, this year and next year, the effective tax burden will be reduced to 2.5%.


2. From April 1 this year to the end of next year, the starting point of VAT for small-scale taxpayers, such as small and micro enterprises and individual entrepreneurs, will be increased from the current monthly sales of RMB 100,000 to RMB150,000.

 

3. From April 1 this year, manufacturing enterprises such as transportation equipment, electrical machinery, instruments, pharmaceuticals and chemical fibers will be included in the scope of the VAT retention refund policy for advanced manufacturing enterprises, and the full refund of the incremental retained tax credits will be implemented on a monthly basis.


         These manufacturing industry VAT credit refunds are fully refunded on a monthly basis, which will reduce the capital occupation of manufacturing enterprises and lower operating costs. Coupled with the manufacturing R & D expenses plus deduction ratio to 100% this year, further reducing the burden of manufacturing enterprises, encourage enterprises to increase investment in R & D, update equipment, and promote the transformation and upgrading of enterprises.


     The meeting also stressed that, while implementing the tax reduction policy, the relevant departments should orderly and reasonably reduce non-tax revenue, and resolutely prevent various names from increasing the burden on enterprises.



 【New Law Express】


The State Administration for Market Regulation issued 'Measures for the Supervision and Administration of Online Transactions”


On March 15, the State Administration for Market Regulation issued the 'Measures for the Supervision and Administration of Online Transactions ', to be effective May 1, 2021, and at the same time the original Measures for the Administration of Online Transactions promulgated on March 15, 2014 shall be repealed.


The Measure has made clear provisions to the current social e-commerce and other network trading activities in the positioning of the operator. Among them, social networking, live streaming and other online service providers that provide online business premises, product browsing, order generation, online payment and other online transaction platform services for operators shall perform the obligations of online transaction platform operators in accordance with the law. Operators that carry out online transaction activities through the aforesaid online transaction platform services shall perform the obligations of operators on platforms in accordance with the law.

 

In addition, the Measure put forward various specific compliance requirements to the network trading operators, mainly including the registration of market entities within the platform, public disclosure, reporting obligations; fair competition obligations; lawful collection, use of consumer personal information obligations.


Among them, the registration of market subjects within the platform, public disclosure, reporting obligations require platform operators: 1) dynamic monitoring of subjects not registered as market subjects; 2) timely reminder of the cumulative annual transaction value exceeds the limit of market subjects for subject registration; 3) to the local market supervision and management departments to report the situation of registered and unregistered operators within the platform, including the unregistered, the annual transaction value of more than 10 (2) timely remind market entities to apply for registration; 3) report to the local market supervision and management departments the situation of registered and unregistered operators in the platform, including the unregistered, the annual transaction value of more than RMB 100,000 million platform operators for special label.


The obligation of fair competition requires that the platform operator shall not interfere with the independent operation of the merchant by making unreasonable restrictions or attaching unreasonable conditions, such as 1) prohibiting or restricting the operator within the platform from independently selecting multiple platforms to carry out business activities by means of search downgrading, shelving goods, restricting operation, blocking stores, etc., or using unfair means to restrict its business activities only on specific platforms; 2) prohibiting or Show the operator on the platforms toselect the express logistics and other transaction support service providers at their own discretion, etc.

 

Lawful collection and use of consumer personal information obligations require that online transaction operators shall collect and use the personal information of consumers by following the principles of legitimacy, rightfulness and necessity, expressly state the purposes, methods and scope of information collection and use, and obtain the consent of consumers. Online transaction operators shall not force customers or force them in a disguised form to consent to the collection and use of information not directly related to their business activities by means of one-off general authorization, implied authorization, bundling with other authorizations, or the suspension of installation.



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