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China to Readjust Sales Tax Policy
China will make readjustments to its sales tax policy, the Ministry of Finance announced Friday.

The central government has decided to abolish a preferential policy which exempts newly established foreign-funded firms and foreign financial companies from paying sales tax for their revenues from special economic zones, including the Pudong New District and the Suzhou Industrial Park, for five years, according to a press release from the ministry.

Such a change is made in line with the principle of taxation fairness and in preparation for China's entry into the World Trade Organization, the ministry said.

Meanwhile, the government has decided to impose a unified sales tax rate of 20 percent, instead of the present fluctuating sales tax rates, on a number of specified entertainment operations like night clubs.

The ministry did not mention in the press release when the readjustments will take effect and press officers of the ministry could not be reached for comment Friday afternoon.

The ministry also said that it will clean up the preferential tax policies that expired at the end of last year.

(Xinhua 04/07/2001)

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