Tax services

Worldwide tax summaries Asian Tax and Advisory Webcast Series

China Tax/Business News Flash 

View this page in: 简体中文版

Oct 2015, Issue 41

China announced her stance on BEPS and her localisation plans


On 5 October 2015, the Organisation for Economic Co-operation and Development (OECD) released the final reports on all of the 15 action points of the Base Erosion and Profit Shifting (BEPS) Action Plan (the BEPS Package). Soon after that, all the G20 finance ministers endorsed the BEPS Package in Lima, Peru on 8 October.

With an amazingly response time, China’s State Administration of Taxation (SAT) held a propaganda conference in Beijing on 10 October 2015 to present its stance on the BEPS Package and future action plans to localise the recommendations on an as-needed basis. At the same time, the SAT also published the Chinese translation of all of the BEPS reports on its official website.

We anticipate that the BEPS Package will bring along significant changes, over a reasonable time span, in China’s transfer pricing (TP) standards, tax treaties, many parts of her domestic tax laws and regulations, and even Chinese tax authorities’ behaviours, with an aim to counter tax avoidance as well as reinforcing her taxing rights to get a fairer share of MNC’s taxation.

Multinational companies (MNCs), be they foreign-based doing business in China or Chinese-based doing business overseas, need to get ready for the challenge of new requirements on transparency and substance-tax alignment. They are suggested to assess the impact of the BEPS recommendations and SAT’s action plans on their business and tax strategies as soon as possible in light of the BEPS Package and the BEPS-driven changes of China’s tax laws and regulations.

Other issues of China Tax/Business News Flash
Visit our Tax Library.
Contacts
Spencer Chong
Partner
Shanghai
Tel: +[86] (21) 2323 2580 Email
Jeff Yuan
Partner
Shanghai
Tel: +[86] (21) 2323 3495 Email
Qisheng Yu
Partner
Beijing
Tel: +[86] (10) 6533 3117 Email
Cecilia Lee
Partner
Hong Kong
Tel: +[852] 2289 5690 Email
Mei Gong
Partner
Shanghai
Tel: +[86] (21) 2323 3667 Email
More contacts