Tentative Administrative Measures for the Deduction of Value-Added Tax for Transportation Charges in Invoices

Tentative Administrative Measures for the Deduction of Value-Added Tax for Transportation Charges in Invoices

Guo Shui Fa [2003] No. 121

October 17, 2003

Article 1 The present Measures are hereby formulated in order to further strengthen the administration of the deduction of value-added tax for transportation charges in invoices and to eliminate any loopholes in taxation.

Article 2 The present Measures shall apply to any general taxpayer of value-added tax (hereinafter referred to as "taxpayer") who has obtained transport invoices and should calculate deductible input tax.
The term "transport invoices" used herein refers to:
1. Freight bills obtained by a taxpayer after paying freight costs for goods purchased (excluding fixed assets), and
2. Freight bills obtained by a taxpayer after paying freight costs for taxable goods sold (excluding freight advanced that shall not be included in the turnover as provided for in Article 12 of the Implementing Rules of the Tentative Regulation of the People's Republic of China on Value-Added Tax).

Article 3 Transport invoices issued by a transporter for transport services provided and transport invoices issued for transporters and individuals by intermediary agencies entrusted by local taxation administrations in charge of transporters and local provincial taxation administrations shall be deductible.
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