• State Administration of Taxation Strengthens Its Policies
  • September 14, 2009
  • Law Firm: Troutman Sanders LLP - Atlanta Office
  • Released on July 27, 2009, and effective as of the same date

    The State Administration of Taxation (“SAT”), in order to strengthen the administration of tax collection, requires that the tax authority shall:

    (1) Strengthen the administration of the consolidated tax payment of an enterprise operating across different locations;

    (2) Proactively obtain the equity transfer information of resident enterprises from the business registration authority, obtain the equity exchange rate, and also collect the transaction information for any domestic equity transfer for non resident enterprises in order to prevent abusing tax treaties and/or tax shelters;

    (3) Supervise cross border affiliated transactions in order to prevent transferring operation losses from offshore companies to onshore affiliated companies, especially for those onshore companies that solely engage in the manufacture, distribution, or research and development, etc;

    (4) Periodically exchange information of real estate enterprises regarding the income tax and business tax in order to supervise and control all tax-related actions at all stages of the development of a real estate project.