What is the VAT refund? VAT refund review

concept

The so-called retained tax credit can be simply understood as when the input tax is greater than the output tax, the retained tax credit occurs. Input tax refers to the value-added tax paid by taxpayers when purchasing goods, intangible assets or real estate, etc., while output tax refers to the value-added tax collected when selling. Generally speaking, there are many reasons for the formation of retained tax credits, such as concentrated investment and long production cycle of goods.

policy

On the evening of March 21, 2019, the Ministry of Finance, the State Administration of Taxation, and the General Administration of Customs jointly issued the "Announcement on Policies for Deepening Value-Added Tax Reform" (hereinafter referred to as the "Announcement"), which mentioned that from April 1, 2019, a trial system for refunding value-added tax end-of-period retained tax credits will be implemented.

Implementation

In 2018, based on the implementation of a one-time VAT refund of 7.1 billion yuan, Shandong established a normalized VAT refund system in 2019 in accordance with the relevant provisions of the country's deepening value-added tax reform.

In October 2019, the vast majority of taxpayers welcomed their first tax refund period. A total of 509 enterprises in Shandong Province applied for tax refunds, and 3.9 billion yuan in taxes were refunded. The tax refund enterprises were mainly concentrated in the three industries of construction, manufacturing and real estate, which received tax refunds of 1.424 billion yuan, 959 million yuan and 945 million yuan respectively. Among them, 124 advanced manufacturing enterprises received tax refunds of 239 million yuan.

significance

VAT refund is an important measure to implement the large-scale tax and fee reduction policy. The implementation of the VAT refund policy will help ease the financial pressure of enterprises in Shandong Province, support enterprises to expand investment, promote technological equipment upgrades, effectively stimulate market vitality, and promote high-quality economic development.

References

• 1. Announcement of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs on the relevant policies for deepening the VAT reform: State Administration of Taxation