(Promulgated by the State Council on October 1, 1988)
All units and individuals who execute or receive documents in the categories specified in these Regulations within the People's Republic of China shall be taxpayers subject to stamp tax (hereinafter referred to as taxpayers) and shall pay stamp tax in accordance with the provisions of these Regulations.
The following categories of documents shall be regarded as taxable documents:
(1) contracts or documents in the nature of a contract with regard to purchases and sales, the undertaking of processing, contracting for construction projects, property leasing, commodity transport, warehousing, loans, property insurance, technology contracts;
(2) documents transferring property rights;
(3) business account books;
(4) certificates evidencing right or licenses; and
(5) other documents which the Ministry of Finance determines to be taxable.
According to the nature of the taxable document, taxpayers shall calculate the amount of tax due on the basis of a percentage tax rate or a fixed amount per document. Determination of the specific tax rate or amount of tax shall be made with reference to the Schedule of Tax Items and Tax Rates accompanying these Regulations.
No stamp tax shall be due where the amount of tax payable does not exceed one jiao. Where the amount of tax payable is one jiao or more, an odd amount not exceeding five fen shall not be counted; where the odd amount is five fen or more, the tax shall be calculated to the nearest jiao.
The following documents shall be exempt from stamp tax:
(1) duplicates or copies of documents on which stamp tax has already been paid;
(2) documents executed when property is donated to the government, social welfare units or schools;
(3) other documents approved by the Ministry of Finance for exemption from stamp tax.
Measures for the payment of stamp tax shall be implemented whereby taxpayers shall, in accordance
with the provisions, compute the amount of tax due and purchase and affix at one time the full corresponding amount of tax stamps (hereinafter referred to as stamping).
In order to simplify the stamping procedures where the amount of tax is relatively large or where frequent stamping is necessary, taxpayers may apply to the tax authorities to use a tax payment account instead of stamping, or a periodic payment method.
Tax stamps shall be affixed to taxable documents; taxpayers shall cancel
each stamp along its border with a seal or a drawn line. Tax stamps that have already been affixed may not be reused.
Tax stamps shall be affixed to taxable documents at the time of execution or upon receipt.
Where the same document is executed by two or more parties and each party is issued a copy, each party shall be responsible for affixing on its own copy the full amount of tax stamps due.
where a document on which tax stamps have already been affixed is amended, resulting in an increase in the value thereof, additional tax stamps shall be affixed on the document in accordance with the amount of such increase.
The tax authorities shall be responsible for the administration of the collection of stamp tax.
The State Administration of Taxation shall supervise the printing of tax stamps. The face value of tax stamps shall be denominated in Renminbi.
Units issuing or processing taxable documents shall be responsible for the supervision of taxpayers in respect of the payment of stamp tax in accordance with the law.
Where taxpayers are found to have engaged in any of the following, the tax authorities shall impose penalties according to the seriousness of the case:
(1) In the case of a failure to affix tax stamps, or of failure to affix a sufficient amount of tax stamps, on taxable documents, the tax authorities, in addition to ordering taxpayers to affix the correct amount of tax stamps, may impose a fine not exceeding twenty times the amount of tax payable.
(2) In the case of a violation of the provisions of Paragraph 1 of Article 6 of these Regulations, the tax authorities may impose a fine not exceeding ten times the amount of the tax stamps that were not canceled by a seal or by a drawn line
(3) In the case of a violation of the provisions of Paragraph 2 of Article 6 of these Regulations, the tax authorities may impose a fine not exceeding thirty times the amount of tax stamps that have been reused.
In a case where tax stamps have been forged, the tax authorities shall submit the matter to the judicial authorities for investigation into criminal liability in accordance with the law.
In addition to being administered in accordance with the provisions of these Regulations, the collection of stamp tax shall be administered in accordance with the relevant provisions of the "Provisional Regulations of the People's Republic of China on Tax Administration."
The Ministry of Finance shall be responsible for the interpretation of these Regulations; the Ministry of Finance shall also formulate detailed rules for the implementation of these Regulations.
These Regulations shall come into force on October 1, 1988.
This translation, together with any explanatory material, is provided courtesy of Lehman Tax & Accounting.