The PPP model (Public-Private-Partnership, that is, the "public sector-private enterprise-cooperation" model) refers to the public sector establishing a partnership with the private sector,** The simultaneous provision of public products or services is a new financing model that emerged after the 1990s (Trust Weekly Chapter). A typical structure of the PPP model is that the public security department signs a concession contract with a special purpose company composed of the winning bidder, and the special purpose company is responsible for financing, construction and operation. The essence of this form of financing is that the government solves the government's financial dilemma by granting long-term franchise rights and income rights to private companies in exchange for infrastructure construction.
In order to promote the development of the PPP model, the Ministry of Finance has successively issued the "Notice of the Ministry of Finance on Issuing the Operation Guidelines for the Government-Private Cooperation Model (Trial)" (Caijin [2014] No. 113), the "State Council's Notice on "Opinions on Strengthening the Management of Local Government Debt" (Guofa No. 201443) and "Notice of the Ministry of Finance on Issues Concerning the Promotion of the Government-Private Cooperation Model" (Caijin [2014] No. 76). The introduction of the above policies fully proves that The government attaches great importance to and affirms the direction of public-private cooperation in the public economic field, encourages social capital to participate in the provision of public products and public services and obtain reasonable returns, and vigorously promotes the PPP model of project financing. However, what tax preferential policies can be enjoyed for PPP project construction? Through research, the preferential tax policies for PPP projects in my country are sorted out and summarized as follows:
1. Preferential tax policies during the operation period of PPP projects
(1) Preferential corporate income tax policies
p>Income from investment and operations realized in the following PPP projects enjoys the following preferential corporate income tax policies.
1. Corporate income tax reduction and exemption policy: enjoy the corporate income tax policy of three exemptions and three half reductions
According to the "Enterprise Income Tax Law of the People's Republic of China" (the People's Republic of China's Enterprise Income Tax Law) Paragraph 2 and Paragraph 3 of Article 27, Presidential Order No. 63, "Regulations on the Implementation of the Enterprise Income Tax Law of the People's Republic of China" (Order of the State Council of the People's Republic of China, No. 512) Article 87, "Notice of the Ministry of Finance and the State Administration of Taxation on Issues Concerning the Implementation of the Catalog of Enterprise Income Tax Preferences for Public Infrastructure Projects" (Caishui [2008] No. 46) and "The Notice of the State Administration of Taxation on Implementing the Catalog of Enterprise Income Tax Preferences for Public Infrastructure Projects" **Notice on Corporate Income Tax Preferences for Infrastructure Projects" (Guo Shui Fa [2009] No. 80), investment enterprises engaged in ports, terminals, airports, railways, highways stipulated in the "Catalogue of Corporate Income Tax Preferences for Public Infrastructure Projects" , urban public transportation, electricity, water conservancy and other projects. Income from qualified environmental protection, energy-saving and water-saving projects such as public sewage treatment, public garbage treatment, comprehensive development and utilization of biogas, energy-saving and emission reduction technological transformation, seawater desalination, etc., and the first production and operation transaction was obtained from the project Starting from the tax year to which the income belongs, corporate income tax is exempted from the first to the third year, and corporate income tax is levied at a half rate from the fourth to the sixth year. Newly launched public infrastructure projects supported by the state and qualified environmental protection, energy and water conservation projects can enjoy tax incentives starting from the first production and operation income.
In addition, Article 1 of the "Supplementary Notice of the Ministry of Finance and the State Administration of Taxation on the Issue of Preferential Corporate Income Tax Policies for Public Infrastructure Projects" (Caishui [2014] No. 55) also stipulates: Enterprise investment and operations Public infrastructure projects that meet the conditions and standards specified in the "Catalogue of Corporate Income Tax Preferences for Public Infrastructure Projects" shall be approved once and in batches (such as wharves, berths, terminals, runways, road sections, generating units etc.) construction, if the following conditions are met at the same time, the income can be calculated on a unit basis for each batch, and enjoy the "three exemptions and three half reduction" corporate income tax benefits: (1) Different batches are spatially independent from each other; (2) ) Each batch has its own function of obtaining income; (3) Accounting is performed on each batch as a unit, the income is calculated separately, and period expenses are reasonably allocated.
2. Investment deduction for corporate income tax: 10% of the investment in special equipment can be offset against the corporate income tax payable for the year
According to the "Corporate Income Tax Law of the People's Republic of China" (Order of the President of the People’s Republic of China No. 63) Article 34 stipulates: The investment amount invested by enterprises in purchasing special equipment for environmental protection, energy and water conservation, and production safety can be tax credited at a certain proportion ( Trust Weekly Chapter). The so-called tax credit refers to the environmental protection specified in the "Enterprise Income Tax Preferential Catalog for Special Equipment for Environmental Protection", the "Enterprise Income Tax Preferential Catalog for Special Equipment for Energy and Water Saving" and the "Enterprise Income Tax Preferential Catalog for Special Equipment for Safety Production" that an enterprise purchases and actually uses. For special equipment such as energy conservation, water conservation, and production safety, 10% of the investment in the special equipment can be deducted from the enterprise's tax payable for the current year; if the deduction is insufficient for the current year, it can be carried forward for the next five tax years. Among them, the amount of investment in special equipment, according to the provisions of Article 2 of Finance and Taxation [2008] No. 48, refers to the total invoice and tax price of the purchase of special equipment, but does not include the value-added tax refunded in accordance with relevant regulations, as well as equipment transportation, installation and Debugging and other costs. The tax payable for the current year, according to the provisions of Article 3 of Caishui [2008] No. 48, refers to the taxable income of the enterprise for the current year multiplied by the applicable tax rate, deducting deductions in accordance with the Enterprise Income Tax Law and the relevant tax preferential regulations of the State Council and the tax transitional preferential regulations. The balance after tax collection and exemption. Enterprises that enjoy the investment tax exemption from corporate income tax should actually purchase and actually put into use special equipment for environmental protection, energy and water conservation, production safety, etc.; if an enterprise purchases the above-mentioned special equipment and transfers or leases it within 5 years, it should stop enjoying corporate income tax. preferential treatment and repay the corporate income tax that has been deducted. According to the relevant provisions of Caishui [2008] No. 48, the investment amount of enterprises using self-raised funds and bank loans to purchase special equipment can be deducted from the amount of income tax payable by the enterprise in accordance with the provisions of the Enterprise Income Tax Law; the investment of enterprises using fiscal appropriations to purchase special equipment The amount shall not be deducted from the amount of income tax payable by the enterprise. If an enterprise purchases and actually puts into use special equipment that has begun to enjoy tax preferential treatment, if it is transferred or leased within 5 tax years from the date of purchase, the enterprise shall stop enjoying corporate income tax preferential treatment in the month when the special equipment ceases to be used, and must make up for the tax credits that have already been deducted. Exemption from corporate income tax. The transferee of the transfer can deduct 10% of the investment amount of the special equipment against the corporate income tax payable for the current year; if the tax payable for the current year is insufficient for the credit, it can be carried forward for the next five tax years.
According to the provisions of the "Notice of the State Administration of Taxation on Issues Concerning the Deduction of Corporate Income Tax for Investments in Special Equipment for Environmental Protection, Energy Saving, Water Saving and Safety Production" (Guo Shui Han [2010] No. 256), taxpayers purchase and merge For those who actually use special equipment within the scope of the specified catalog and obtain special VAT invoices, if the input VAT is allowed to be deducted, the investment in special equipment will no longer include the input VAT; if the input VAT is not allowed to be deducted, the input VAT will not be deducted. The amount of investment in special equipment shall be the total price and tax stated on the special VAT invoice. If an enterprise purchases special equipment and obtains an ordinary invoice, the investment amount of the special equipment shall be the amount indicated on the ordinary invoice.
3. Corporate income tax policy for dividend distribution by the project company during the operation period
According to the "Enterprise Income Tax Law of the People's Republic of China" (Order of the President of the People's Republic of China) 63), the project company's dividend distribution during the operation period enjoys the following preferential corporate income tax policies:
1. If the project company distributes dividends during the operation period and distributes dividends among domestic resident enterprises, it is exempt from corporate income tax; When a domestic resident enterprise distributes dividends to natural person shareholders, 20% of personal income tax must be withheld and paid.
2. If the project company has overseas shareholders and distributes cross-border dividends to overseas non-resident enterprises, a withholding income tax of 10% is generally applicable. If the overseas non-resident enterprise has signed a bilateral tax agreement with China, in compliance with the Under certain conditions, the preferential withholding income tax rate under tax treaty arrangements can be applied.
(2) Value-added tax preferential policies
Those engaged in projects involving comprehensive resource utilization and environmental protection such as sewage treatment, garbage treatment and wind power in PPP projects can enjoy the following value-added tax preferential policies.
1. Sales of self-produced recycled water are exempt from value-added tax
"Notice of the Ministry of Finance and the State Administration of Taxation on Value-Added Tax Policies for Comprehensive Utilization of Resources and Other Products" (Caishui [2008] No. 156 ) Article 1, Item (1) stipulates: Sales of self-produced recycled water are exempt from value-added tax. The so-called recycled water refers to the recovery of water sources such as sewage treatment plant effluent, industrial drainage (mine water), domestic sewage, and garbage treatment plant permeate (filtrate). After appropriate treatment, it reaches certain water quality standards and is repeated within a certain range. Utilized water resources. Reclaimed water should comply with the relevant provisions of the "Reclaimed Water Quality Standards" (SL368-2006) of the Ministry of Water Resources.
2. Sewage treatment services are exempt from value-added tax
According to the "Notice of the Ministry of Finance and the State Administration of Taxation on Value-Added Tax Policies for Comprehensive Utilization of Resources and Other Products" (Caishui [2008] No. 156 ) Article 2 stipulates that sewage treatment services are exempt from value-added tax. Sewage treatment refers to the business of processing sewage to meet the water quality standards stipulated in GB18918-2002.
3. The policy of immediate refund of value-added tax
(1) The policy of immediate refund of 100% value-added tax for the sale of electricity or heat produced with garbage as fuel
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According to the provisions of Article 3 (2) of Caishui [2008] No. 156, the VAT policy for the sale of electricity or heat produced with garbage as fuel shall be refunded immediately upon collection. The proportion of waste consumption in power generation fuel shall not be less than 80%, and production emissions shall meet the standards for the first period of GB13223-2003 or the relevant regulations of GB18485-2001. The so-called garbage refers to municipal domestic garbage, crop straw, bark waste, sludge, and medical waste.
(2) For the sale of electricity and heat produced with coal gangue, coal slime, stone coal, and kerogen shale as fuel, a policy of 50% VAT refund upon collection will be implemented
According to the fiscal and taxation [ According to the provisions of Item 4 (4) and (5) of No. 156 of 2008, 50% of the value-added tax realized on the sale of the following self-produced goods shall be refunded immediately upon collection: coal gangue, coal slime, stone coal, and kerogen shale as fuel Produced electricity and heat. The proportion of coal gangue, coal slime, stone coal, and kerogen shale in power generation fuel shall not be less than 60%; the electricity produced by wind power shall be used.
(3) For the sale of self-produced electricity or heat, a policy of refunding 100% of the value-added tax as soon as it is collected
According to the "Ministry of Finance and the State Administration of Taxation's Notice on Adjusting and Improving Comprehensive Resource Utilization Products and According to the provisions of the "Notice on the Labor Value-Added Tax Policy" (Caishui [2011] No. 115), the policy of refunding 100% of the value-added tax upon collection is implemented for the sales of the following self-produced goods: namely (1) using the waste heat and pressure generated in the industrial production process Produced electricity or heat. (2) Food waste, livestock and poultry manure, rice husks, peanut shells, corn cobs, camellia oleifera husks, cottonseed husks, leftovers, sub-small fuelwood, oily sewage, organic wastewater, sludge generated after sewage treatment, The oil sludge (scum) produced during the oil production process in oil fields includes electricity, heat, and fuel produced by using biogas produced by fermentation of the above resources as raw materials.
4. Garbage treatment and sludge treatment and disposal services are exempt from value-added tax
"Notice of the Ministry of Finance and the State Administration of Taxation on Adjusting and Improving the Value-Added Tax Policy for Comprehensive Utilization of Resources Products and Services" (Caishui [2011] No. 115), the value-added tax policy for comprehensive utilization of agricultural and forestry residue resources has been adjusted and improved, and preferential value-added tax policies for some comprehensive resource utilization products and services have been added. Among them, the tax benefits related to the operation of PPP projects related to garbage disposal are: exemption from value-added tax on garbage disposal and sludge treatment and disposal services.
2. Tax treatment of PPP projects: Project expiry handover stage
Since the project company in the PPP project obtains a government concession license for a certain period, when the concession period expires Later, when the operation period expires, all assets will be transferred to the government free of charge. In essence, it does not have ownership of the facilities. Since the tax basis of its intangible assets has been amortized within the franchise period, there will be no tax treatment.