A big list of tax incentives for PPP projects
The PPP model (Public-Private-Partnership, i.e. ? Public*** Sector-Private-Partnership? model) refers to the public **** sector through the establishment of partnerships with the private sector, *** with the provision of public **** products or services, is a new financing model that emerged after the 1990s (Trust Weekly Chapter). The following is the knowledge that I bring you a big list of tax incentives for PPP projects, welcome to read.
First, the tax preferential policies of the PPP project operating period
(a) preferential policies on enterprise income tax
Engaged in the following PPP projects to realize the investment and business income to enjoy the following preferential policies on enterprise income tax. No. 87), the Circular of the Ministry of Finance and the State Administration of Taxation on Issues Relating to the Implementation of the Preferential Catalog of Enterprise Income Tax for Public **** Infrastructure Projects (Cai Shui [2008] No. 46) and the Circular of the State Administration of Taxation on the Preferential Issues of Enterprise Income Tax for Implementing the Public **** Infrastructure Projects that the State is Focused on Supporting (Guoshuifa [2009] No. 80), the provisions of which stipulate that an investing enterprise engaging in the "Public *** Infrastructure Projects Enterprise Income Tax Preferential Catalogue" stipulated in the port terminals, airports, railroads, highways, urban public **** transportation, electric power, water conservancy and other projects. Income from qualified environmental protection, energy and water conservation 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., shall be exempted from enterprise income tax for the first to the third year, and halved from the fourth to the sixth year from the taxable year in which the project obtains the first production and operation income. The starting time for enjoying tax incentives for new public **** infrastructure projects and qualified environmental protection, energy and water conservation projects is the first production and operation income.
In addition, Article 1 of the Supplementary Circular of the Ministry of Finance and the State Administration of Taxation on Issues Concerning Preferential Policies on Enjoyment of Enterprise Income Tax for Public **** Infrastructure Projects (Cai Shui [2014] No. 55) also stipulates that: the enterprise investing in and operating a public **** infrastructure project that complies with the conditions and standards set forth in the "Catalogue of Preferential Enterprise Income Tax for Public **** Infrastructure Projects" shall be subject to the following conditions and standards, using the one-time approval, batch ( such as wharves, berths, terminals, runways, road sections, generator sets, etc.), where the following conditions are simultaneously met, the income can be calculated on a per-batch basis and enjoy the enterprise income tax ? Three exemptions and three half-reduces? preferences: (1) different batches are spatially independent of each other; (2) each batch has its own function of obtaining income; (3) accounting for each batch as a unit, calculating income separately, and reasonably apportioning the costs of the period.
2, investment credit enterprise income tax: 10% of the investment in special equipment to offset the current year's enterprise income tax payable
According to the "People's Republic of China *** and the State Enterprise Income Tax Law" (Order of the President of the People's Republic of China *** and the State Decree No. 63), Article 34 stipulates that: the enterprise to purchase for environmental protection, energy saving, water conservation, safe production and other special equipment investment, you can be a certain percentage of the tax credit (tax credit). The tax credit can be applied in a certain proportion (Trust Weekly Chapter). The so-called tax credit refers to the fact that if an enterprise acquires and actually uses the special equipment for environmental protection, energy saving and water conservation and safety production as stipulated in the "Preferential Catalogue of Enterprise Income Tax for Special Equipment for Environmental Protection", "Preferential Catalogue of Enterprise Income Tax for Energy Saving and Water Conservation Special Equipment" and the "Preferential Catalogue of Enterprise Income Tax for Special Equipment for Safe Production", 10% of the amount of the investment in the special equipment may be credited from the tax payable by the enterprise for the current year; if the credit is insufficient for the current year, the enterprise may apply a certain proportion of the investment. If the credit is insufficient in the current year, it can be carried forward in the next five tax years. The investment amount of the special equipment, according to the provisions of Article 2 of Cai Shui [2008] No. 48), refers to the total price of the invoice price and tax for the purchase of special equipment, but does not include the refund of value-added tax in accordance with the relevant provisions of the value-added tax, as well as the cost of equipment, transportation, installation and debugging, and so on. The tax payable for the year, according to the provisions of Article 3 of Cai Shui [2008] No. 48), refers to the balance of the enterprise's taxable income for the year multiplied by the applicable tax rate, after deducting the amount of tax reduced or exempted in accordance with the Enterprise Income Tax Law and the State Council's relevant tax incentives as well as the provisions of the Tax Transitional Incentives. Enterprises enjoying investment credit enterprise income tax preferences shall actually purchase and put into use their own special equipment for environmental protection, energy and water conservation, safe production, etc.; enterprises purchasing the above special equipment for transfer or lease within five years shall stop enjoying enterprise income tax preferences and make up for the enterprise income tax that has been credited. According to the relevant provisions of Cai Shui [2008] No. 48, the investment amount of special equipment purchased by enterprises using self-financing and bank loans can be offset against the amount of enterprise income tax payable in accordance with the provisions of the Enterprise Income Tax Law; the investment amount of special equipment purchased by enterprises using financial allocations shall not be offset against the amount of enterprise income tax payable. If an enterprise purchases and actually puts into use the special equipment and starts to enjoy the tax benefits, if it transfers or leases out the equipment within five tax years from the date of purchase, it shall stop enjoying the enterprise income tax benefits in the month when the special equipment ceases to be used and pay back the enterprise income tax that has already been credited. The transferee of the transfer can offset the current year's enterprise income tax payable by 10% of the investment amount of the specialized equipment; if the current year's tax payable is insufficient to offset the tax payable, it can be carried forward to offset the tax payable in the next five tax years.
According to the "Notice of the State Administration of Taxation on the Issues Relating to the Credit of Enterprise Income Tax on Investment in Special Equipment for Environmental Protection, Energy Saving, Water Conservation, Safe Production, etc." (State Taxation Letter [2010] No. 256), the taxpayers who purchased and actually used the special equipment within the scope of the specified catalog and obtained the VAT invoices, such as VAT input tax credit is allowed, and the amount of investment in the special equipment no longer includes the amount of VAT input; and the amount of investment in special equipment no longer includes the amount of VAT input tax; the amount of investment in special equipment is not included. If the VAT input tax is allowed to be deducted, the investment amount of the special equipment shall be the total amount of price and tax stated on the VAT special invoice. If the enterprise purchases special equipment and obtains ordinary invoices, the investment amount of the special equipment shall be the amount stated on the ordinary invoices.
3. Enterprise Income Tax Policy on Dividend Distribution of the Project Company during the Operation Period
According to the provisions of the Enterprise Income Tax Law of the People's Republic of China (Decree No. 63 of the President of the People's Republic of China), the dividend distribution of the project company during the operation period is entitled to the following preferential policies on enterprise income tax:
1. Involved in dividend distribution during the operation period, if the project company is distributed among domestic resident enterprises, exempted from enterprise income tax; domestic resident enterprises distributing dividends to natural person shareholders are required to withhold and pay 20% individual income tax on behalf of the shareholders.
2. If the project company has overseas shareholders, the cross-border distribution of dividends to overseas non-resident enterprises is generally subject to a 10% withholding tax, and if there is a bilateral tax treaty between the overseas non-resident enterprises and China, the preferential withholding tax rate under the tax treaty arrangement can be applied under certain conditions.
(II) Preferential VAT Policies
PPP projects involving comprehensive utilization of resources and environmental protection, such as sewage treatment, garbage treatment and wind power, can enjoy the following preferential VAT policies.
1, the sale of self-produced reclaimed water exempt from VAT
"Ministry of Finance, State Administration of Taxation on the Comprehensive Utilization of Resources and other products VAT policy notice" (Cai Shui [2008] No. 156), Article 1, paragraph (a): the sale of self-produced reclaimed water is exempt from value-added tax. The so-called reclaimed water refers to the sewage treatment plant effluent, industrial drainage (mine water), domestic sewage, garbage treatment plant infiltration (filtration) liquid and other sources of water recycling, after appropriate treatment to meet certain water quality standards, and reuse of water resources within a certain range. Recycled water should be consistent with the Ministry of Water Resources, "recycled water quality standards" (SL368?2006) of the relevant provisions.
2, sewage treatment services are exempted from value-added tax
According to the "Ministry of Finance, State Administration of Taxation on the comprehensive utilization of resources and other products of value-added tax policy notice" (Cai Shui [2008] No. 156) Article 2, sewage treatment services are exempted from value-added tax. Sewage treatment refers to the business of processing sewage to meet the water quality standards set by GB18918?2002.
3, the policy of immediate refund of VAT
(1) the sale of electricity or heat produced from garbage as fuel to implement the policy of immediate refund of 100% of the VAT
According to the Cai Shui [2008] No. 156, Article 3, paragraph (b). According to the provisions of Article 3(b) of Cai Shui [2008] No. 156, the policy of immediate refund of VAT is applied to the sale of electricity or heat produced by using garbage as fuel. The amount of garbage used shall not be less than 80% of the fuel used for power generation, and the emissions from the production shall meet the standards of the 1st period of GB13223?2003 or the relevant provisions of GB18485?2001. The so-called garbage refers to municipal garbage, crop residue, bark waste, sludge, and medical waste.
(2) the sale of gangue, coal sludge, stone coal, oil mother shale as fuel for the production of electricity and heat, the implementation of the policy of value-added tax that is refunded 50%
According to Cai Shui [2008] No. 156, the fourth item (d) and (e) of the provisions of the sale of the following self-produced goods to achieve the implementation of the value-added tax that is refunded 50% of the policy: coal gangue, coal sludge, stone coal, Electricity and heat produced by using coal gangue, coal sludge, stone coal, oil shale as fuel. Coal gangue, coal sludge, stone coal, oil mother shale accounted for no less than 60% of the proportion of fuel for power generation; the use of wind power production of electricity.
(3) the sale of self-produced electricity or heat to implement the policy of value-added tax instantly refundable 100%
According to the "Ministry of Finance, the State Administration of Taxation on the adjustment and improvement of the comprehensive utilization of resources products and services VAT policy notice" (Cai Shui [2011] No. 115) of the provisions of the sale of the following self-produced goods to implement the policy of value-added tax instantly refundable 100%: that is, (1) Electricity or heat produced by utilizing waste heat and pressure generated in the process of industrial production. (2) Electricity, heat and fuel produced from kitchen waste, animal and poultry manure, rice husk, peanut shells, corn cobs, oil tea husk, cottonseed shells, three leftovers, minor fuelwood, oily wastewater, organic wastewater, sewage sludge produced after sewage treatment, and oil sludge produced in the process of oil extraction from oilfields (slicks), including biogas produced from fermentation of the above resources as raw materials.
4, waste treatment, sludge treatment and disposal services are exempted from value-added tax
"Ministry of Finance, State Administration of Taxation on adjusting and improving the comprehensive utilization of resources products and services VAT policy notice" (Cai Shui [2011] No. 115), the comprehensive utilization of agricultural and forestry residues of resources products VAT policy adjustments to improve and to increase the part of the comprehensive utilization of resources products and services applying VAT preferential policies. Among them, the tax incentives related to the operation of PPP projects related to waste treatment are: exemption of VAT on waste treatment, sludge treatment and disposal labor.
Second, the tax treatment of PPP projects: project expiration of the handover stage
As the project company in the PPP project is granted a certain period of government concession license, after the concession period, the expiration of the operating period, all the assets are handed over to the government free of charge, and essentially do not have the ownership of the facilities, due to the taxable basis of the intangible assets have been amortized over the concession period. The tax basis of the intangible asset has been amortized over the term of the concession, and no tax treatment.
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