Retail Trade and Distribution

“Sale” and “for consideration” defined for consumption tax purposes.

More high-end products subject to consumption tax.

VAT system changed from production-based to consumption-based.

Grosvenor has set up a joint venture with Vega Property Group to establish the US$250 million Grosvenor Vega-China Retail Fund.The fund will focus on investments…

VAT system changed from production-based to consumption-based.

According to the revised Regulations, the amount of consumption tax payable may be calculated ad valorem, at a flat rate or by a combination of the two.

A sweeping VAT reform takes place in China on January 1 2009. It will benefit many domestic companies but could block the cash-flow of some foreign invested enterprises, removing advantages enjoyed under the old tax regime. By Joanna Law.

Approval procedures for commercial FIEs streamlined.

The Circular states that, with certain exceptions, the investment in and establishment of commercial enterprises by foreign investors shall be subject to the examination of the provincial-level departments in charge of commerce.