VAT exemption policy for medical services

What are the preferential VAT policies to support medical treatment?

Answer: (1) Medical services provided by medical institutions are exempted from value-added tax.

Policy basis: "Ministry of Finance State Administration of Taxation on the full promotion of business tax to value-added tax pilot notice" (Cai Shui [2016] No. 36) Annex 3 "business tax to value-added tax pilot transitional policy provisions" Article 1, paragraph (g).

(ii) From February 1, 2019 to December 31, 2020, medical institutions accepting commissions from other medical institutions to provide the National Medical Service Prices in accordance with the guiding prices of medical services (including government guiding prices and prices determined by negotiation between supply and demand in accordance with the regulations, etc.) set by the competent department of price at or above the prefectural (municipal) level in conjunction with the competent department of health at the same level and other relevant departments. The services listed in the "Item Specification" can be applied to the VAT exemption policy stipulated in Article 1(7) of the "Provisions on Transitional Policies for the Pilot Program of Business Tax Conversion to Value-added Tax" (issued by Cai Shui [2016] No. 36).

Policy basis: "Notice of the Ministry of Finance and the State Administration of Taxation on the Clarification of Policies on VAT Exemption for Nursing Institutions" (Cai Shui [2019] No. 20)

(3) The preparations produced for self-use by non-profit medical institutions are exempted from value-added tax (VAT); the income obtained by for-profit medical institutions, which is directly used to improve the conditions of medical care and health care, is exempted from VAT for the preparations for self-use for a period of three years from the date of obtaining the registration of the practice of medicine. Preparations for self-production and self-use are exempted from value-added tax for three years from the date of registration of their practice.

Policy basis: "Ministry of Finance, State Administration of Taxation on the tax policy of medical and health institutions notice" (Cai Shui [2000] No. 42).

(D) the blood station to supply clinical blood to medical institutions are exempt from value-added tax.

Policy basis: "Ministry of Finance, State Administration of Taxation on the blood station tax issues related to the Notice" (Cai Shui Zi [1999] No. 264).

(E) of the health prevention stations to allocate or issue by the government's financial burden of free vaccines are not subject to value-added tax.

Policy basis: "State Administration of Taxation on the health of the epidemic prevention stations on the transfer of biological products and medicines and equipment to collect value-added tax on the approval of the reply" (State Taxation Letter [1999] No. 191).

What are the preferential VAT policies to support the scientific research of medical industry enterprises?

Answer: (1) taxpayers to provide technology transfer, technology development and related technical consulting, technical services are exempted from value-added tax.

Policy basis: "Ministry of Finance State Administration of Taxation on the full promotion of business tax to VAT pilot notice" (Cai Shui [2016] No. 36).

(b) The full refund of VAT on the procurement of domestically produced equipment by qualified domestic R&D institutions and foreign-funded R&D centers will be implemented from January 1, 2019 to December 31, 2020, starting from the first day of the month following the qualification of domestic R&D institutions and foreign-funded R&D centers for the refund of VAT.

The policy is based on the Announcement of the Ministry of Finance, the Ministry of Commerce, and the State Administration of Taxation on the Continued Implementation of the VAT Policy on the Purchase of Equipment by Research and Development Institutions (Announcement of the Ministry of Finance No. 91 of 2019).

What are the preferential VAT policies to support drug manufacturers to sell self-produced innovative drugs?

Answer:The sales of self-produced innovative drugs by drug manufacturers are all the prices and extra-price charges collected from the buyers, and the same innovative drugs provided to patients for free use in the subsequent period do not belong to the scope of VAT deemed sales.

Innovative drugs refer to those APIs and their preparations that have been approved for registration by the State Food and Drug Administration and have not been marketed or sold in China or abroad before approval, and are produced by synthetic or semi-synthetic methods.

Policy basis: "Notice of the Ministry of Finance and State Administration of Taxation on the VAT Policy on the Subsequent Free Use of Innovative Drugs" (Cai Shui [2015] No. 4).

What are the preferential VAT policies to support the production and sale of rare disease medicines, as well as wholesale and retail sales?

A: Since March 1, 2019, general VAT taxpayers producing, selling, wholesaling, and retailing rare disease medicines can choose to pay VAT according to the simplified method of calculating VAT according to the 3% levy rate.

Starting from March 1, 2019, imported rare disease medicines will be subject to a reduced import VAT of 3%.

Policy basis: "Ministry of Finance, General Administration of Customs, General Administration of Taxation, Drug Administration on rare disease drugs VAT policy notice" (Cai Shui [2019] No. 24)

What are the preferential policies to support the production and sale of anticancer drugs, and wholesale and retail VAT?

A: Since May 1, 2018, general VAT taxpayers producing, selling, wholesaling and retailing anti-cancer drugs can choose to pay VAT according to the simplified method of calculating VAT according to the 3% levy rate.

Starting from May 1, 2018, imported anti-cancer drugs will be subject to a 3% reduction in import VAT.

Policy basis: "Ministry of Finance, General Administration of Customs, General Administration of Taxation, State Drug Administration on anti-cancer drugs VAT policy notice" (Cai Shui [2018] No. 47)

What are the preferential policies to support the production and distribution of domestically produced antiviral drugs with VAT?

Answer:From January 1, 2019 to December 31, 2020, domestic anti-HIV medicines will continue to be exempted from value-added tax (VAT) on production and circulation.

Policy basis: "Announcement of the Ministry of Finance and the State Administration of Taxation on the Continuation of the Policy of Exempting Domestic Anti-AIDS Drugs from Value-added Tax" (Announcement of the Ministry of Finance and the State Administration of Taxation No. 73 of 2019)

What are the preferential policies on value-added tax to support the production and distribution of biological products?

Answer: (1) General taxpayers selling self-produced biological products made of microorganisms, microbial metabolites, animal toxins, human or animal blood or tissues can choose to pay value-added tax (VAT) in accordance with the simplified method of calculation based on a 3% levy rate.

Policy basis: "Notice of the Ministry of Finance and State Administration of Taxation on the Policy of Applying Low VAT Rate and Simplified Method of Collecting VAT on Some Goods" (Cai Shui [2009] No. 9)

(2) Since July 1, 2012, pharmaceutical enterprises that are general taxpayers of value-added tax (VAT) for the sale of biologics can choose to pay VAT on the basis of the sales amount of biologics and 3% levy rate under the simplified method. Payment of value-added tax (VAT).

Policy basis: Announcement of the State Administration of Taxation on the VAT Issues Related to the Sales of Biological Products by Drug Business Enterprises (Announcement of the State Administration of Taxation No. 20 of 2012)

According to Article 3 of the Announcement on the Tax Policies Related to the Support for the Prevention and Control of the Pneumonia Epidemic Infected by a New Type of Coronavirus (Announcement of the State Administration of Taxation of the Ministry of Finance No. 8 of 2020), the income derived from the transportation of key materials for the prevention and control of the epidemic by taxpayers is not subject to the VAT. What is the specific scope of medical emergency protection materials in the list of key protection materials for epidemic prevention and control?

A: The Ministry of Industry and Information Technology to determine the epidemic prevention and control of key protection materials list of medical emergency protection materials in the specific scope of the following, the list will be adjusted dynamically according to the needs of epidemic prevention and control.

The list of key protection materials for epidemic prevention and control (medical emergency)

No.

Primary classification

Secondary classification

List of materials

I. Medicines

(a) General treatment and heavy, critical cases of treatment of medicines

α-interferon, lopinavir ritonavir tablets (box), antibacterial drugs, methylprednisolone, glucocorticoids, etc. by the Health and health, drug supervision departments in accordance with the procedures to confirm the treatment of effective drugs and vaccines (to the National Health Commission new coronavirus infection of pneumonia diagnosis and treatment program shall prevail).

(2) Chinese medicine

Patchouli Zhengqi capsule (pills, water, oral liquid), Jinhua Qingqi granules, Lianhua Qingdian capsule (granules), Shufeng Xieduo capsule (granules), Fangfeng Tongsheng Pill (granules), Xiyanping injection, Xuebijie injection, ginseng and appendicitis injection, Shenxian injection, Shengqin injection, Suhuixiang pills, and Anguang Niuhuangwan and other proprietary Chinese medicines (in accordance with the new type of coronavirus infected pneumonia treatment plan of the National Health Commission). Pneumonia Diagnosis and Treatment Program for Infections). Cangzhu, Chenpi, Houpu, Huo Xiang, Cao Guo, raw ephedra, Qiangwu, ginger, betel nut, almonds, raw gypsum, gua vulgaris, raw rhubarb, Drabanemerosa hebecarpa, peach kernel, ginseng, black shunpian, Cornus officinalis, Fahanxia, Dangshen, sizzling Astragali, Poria, and sand nut and other traditional Chinese medicines (based on the diagnosis and treatment plan for pneumonia infected by the new coronavirus of the NHSC).

2, reagents

(a) test and detection supplies

new coronavirus test kits and so on.

3, disinfection supplies and its main raw materials, packaging materials

(a) disinfection supplies

medical alcohol, 84 disinfectant, peroxyacetic acid disinfectant, hydrogen peroxide (3%) disinfectant, chlorine effervescent tablets, free hand disinfectant, quick-drying hand disinfectant and so on.

(B) the main raw materials of disinfection supplies

sodium hypochlorite, hydrogen peroxide, 95% food-grade alcohol and so on.

Squeeze pumps, plastic bottles (barrels), glass bottles (barrels), cartons, labels and so on.

Fourth, protective supplies and its main raw materials, production equipment

(a) protective supplies

medical protective masks, medical surgical masks, medical protective clothing, negative pressure protective hood, medical boots, medical comprehensive respiratory protection machine (device), medical isolation blindfold/medical isolation mask, disposable latex gloves, surgical gowns (clothing), isolation gowns, disposable caps, disposable caps (for patients). Medical caps (for patients), etc..

(B) the main raw materials for protective supplies

film spunbond fabric, breathable film, meltblown nonwoven fabric, isolation eye masks and masks with PET/PC anti-fog rolls and sheets, sealing strips, zippers, antistatic agents and other important raw materials for the production of medical protective clothing, medical masks, and so on.

Protective clothing press machine, mask machine and so on.

V. Specialized vehicles, equipment, instruments and key components

(a) vehicles and equipment

negative pressure ambulances and other types of ambulances, special operating vehicles; negative pressure isolation cabin, negative pressure isolation can be quickly expanded isolation ward, negative pressure isolation tent system; negative pressure on-board system, positive pressure intelligent protection system; CT, portable DR, electrocardiography, ultrasound ultrasound, and so on. Electronic laryngoscope, fiberscope, etc.; ventilator, monitor, defibrillator, high-flow respiratory humidifier, medical electric bed; blood color analyzer, PCR instrument, ACT detector, etc.; syringe pumps, infusion pumps, artificial heart and lungs (ECMO), CRRT and so on.

(ii) extermination equipment

backpack charging ultra-low-capacity sprayer, backpack charging ultra-low-capacity sprayer, hydrogen peroxide disinfector, plasma air disinfector, terminal air disinfector and so on.

automatic infrared temperature monitor, door temperature monitor, handheld infrared thermometer infrared temperature detection equipment and other intelligent monitoring and detection systems.

(D) key components

(D) black body, temperature sensors, sensor chips, display panels, resistive components, detectors, electrical connectors, lithium batteries, printed circuit boards.

Six, the production of the above medical supplies of important equipment

It should be noted that taxpayers operating both tax-exempt projects, should be separately accounted for the transportation of epidemic prevention and control of key security supplies and other tax-exempt projects sales, in the VAT tax declaration, the application of the tax exemption policy of the sales and exemption amount of declared data, filled out in the value-added tax return and the "value-added tax reduction and exemption declaration" corresponding columns. When applying for VAT tax declaration, fill in the corresponding columns of the VAT return and the Detailed VAT Declaration, and select "0001120602|SXA031901111|Taxpayers are exempted from VAT on the income from the transportation of epidemic prevention and control materials" for the tax-exempted nature code and name.