From July 1, 2022, the "Stamp Duty Law of the People's Republic of China" (hereinafter referred to as the "Stamp Duty Law") will come into effect.

1. Clarify the place where stamp duty is paid

Before the promulgation of the Stamp Duty Law, the stamp duty-related regulations in my country have not yet clearly specified the stamp duty tax payment location. Article 13 of the Stamp Duty Law clarifies the issue of where the stamp duty should be paid, solving the long-standing doubts about where the stamp duty should be paid. Article 13 of the Stamp Tax Law stipulates the place of tax payment as follows: "If the taxpayer is an entity, it shall declare and pay stamp duty to the competent tax authority where the taxpayer is located; if the taxpayer is an individual, the taxpayer shall file a taxable certificate or the taxpayer's residence. The competent tax authority declares and pays stamp duty. If the property right of the real estate is transferred, the taxpayer shall declare and pay the stamp duty to the competent tax authority where the real estate is located.”

2. Simplify the tax items of construction engineering contracts and reduce the tax rate of construction engineering survey and design contracts

The Stamp Duty Law no longer distinguishes between construction engineering survey and design contracts and construction and installation engineering contracting contracts, and the above two types of contracts are collectively referred to as construction engineering contracts. After July 1, 2022, when calculating, filing and paying stamp duty, the tax items of construction engineering survey and design contracts and construction and installation engineering contracting contracts are both "construction engineering contracts".

3. The contract separately lists the tax-exclusive amount and the value-added tax amount, and the tax calculation basis is the tax-exclusive amount

Article 5 of the Stamp Tax Law clearly states: "The taxable basis of a taxable contract shall be the amount listed in the contract, excluding the listed value-added tax". When a construction enterprise signs a construction project contract or a purchase contract and other stamp tax taxable vouchers, if the contract specifies the tax-exclusive amount and the value-added tax amount, the stamp tax calculation basis does not include the value-added tax amount.

4.Make it clear that each party to a multi-party contract only pays tax on the amount involved

Article 8 of the "Interim Regulations on Stamp Duty (2011 Amendment)" stipulates: "If the same certificate is signed by two or more parties and each holds one copy, each party shall dedicate the full amount of the copy held by each party." When this policy is implemented, some tax authorities require that each party to the contract, whether or not it is part of the contract, should pay stamp duty on the full amount agreed in the contract. However, Article 10 of the Stamp Tax Law stipulates: "Where the same taxable voucher is signed by two or more parties, the tax payable shall be calculated according to the respective amounts involved". That is to say, for contracts with more than two parties signed after July 1, the parties to the contract only need to calculate and pay taxes according to the amount involved.