Tax preferential policies for business tax on logistics enterprises

Release date:

2021-04-16

Author:

Jinhua Logistics

I. Tax Rates for Major Business Tax Categories in the Logistics Industry 1. Transportation Industry: Tax rate of 3%. The scope of taxation includes land transportation, water transportation, air transportation, pipeline transportation, and loading/unloading and handling services. All labor services related to transportation operations fall within this tax category. Note that salvage operations are taxed as water transportation; general aviation services and ground handling services are taxed as air transportation. Additionally, cargo surveying services related to transportation operations, as well as pilotage, mooring/demouring, berthing, and shifting services provided by port authorities—along with pilotage fees, lockage charges, and port handling fees—are also subject to taxation under the transportation industry. 2. Postal and Telecommunications Industry: Tax rate of 3%. This category covers postal services and telecommunications. Entities and individuals engaged in express delivery services are taxed under the “Postal and Telecommunications Industry” tax category. 3. Service Industry: Tax rate of 5%. This category includes agency services, hotels, catering, tourism, warehousing, leasing, advertising, and other service activities. 4. Transfer of Intangible Assets: Tax rate of 5%. This category encompasses the transfer of land use rights, trademark rights, patent rights, non‑patent technologies, copyright, and goodwill. 5. Sale of Real Estate: Tax rate of 5%. This category includes the sale of buildings or structures, as well as the sale of other fixtures attached to land. II. Differential Taxation for Combined Transport, Agency, and Warehousing Services Combined transport refers to transportation services provided by two or more transport enterprises to carry passengers or goods from the point of origin to the destination. For combined transport, the taxable turnover is calculated as the actual revenue received, which means that when a transport enterprise engages in combined transport, it uses the total revenue collected minus expenses paid to subsequent carriers—such as freight charges, loading/unloading fees, and transshipment costs—as its taxable base. According to the “Notice of the State Administration of Taxation on Issues Related to the Use of the New Version of the Unified Invoice for Road and Inland Waterway Freight Transport” (Guo Shui Fa [2007] No. 101), road and inland waterway combined freight transport refers to freight transport services jointly performed by two or more transport entities (or individuals). Each participating entity (or individual) shall issue a freight invoice to the payer based on the full amount received, while cooperating entities (or individuals) shall issue their own freight invoices to the primary carrier based on the full amount they have collected from the primary carrier. The primary carrier must use the freight invoices issued by cooperating entities as supporting documentation for calculating the differential amount upon which business tax is levied. For logistics enterprises that self‑issue invoices and engage in combined transport, as well as for income derived from freight forwarding, demolition, intellectual property, advertising, and exhibition agency services, business tax is assessed on a differential basis.

I. Tax Rates for the Main Business Tax Categories in the Logistics Industry

1. The transportation industry is subject to a tax rate of 3%. The scope of taxation includes land transport, waterway transport, air transport, pipeline transport, and loading, unloading, and handling services. Any labor‑related activities connected with operational transport are also within the purview of this tax. It should be noted that salvage operations are taxed by analogy to waterway transport; general aviation services and aviation ground‑handling services are taxed by analogy to air transport. Furthermore, cargo surveying and related services, as well as pilotage, mooring and unmooring, berthing and re‑berthing provided by port authorities—along with pilotage fees, lockage charges, and port handling fees—are all included in the tax base for the transportation industry.

2. The postal and telecommunications industry is subject to a tax rate of 3%. The scope of this tax category includes postal services and telecommunications. Units and individuals engaged in express delivery services shall have their business tax levied under the “postal and telecommunications industry” tax category.

3. The service sector is subject to a tax rate of 5%. The scope of this tax category includes: agency services, hotels, catering, tourism, warehousing, leasing, advertising, and other service industries.

4. Transfer of intangible assets: tax rate 5%. The scope of this tax category includes: transfer of land use rights, transfer of… Trademark rights , transfer of patent rights, transfer of non-patent technologies, transfer of copyright, and transfer of goodwill.

5. The tax rate for the sale of real estate is 5%. The scope of this tax category includes the sale of buildings or structures, as well as the sale of other fixtures attached to land.

II. For combined transport, agency, and warehousing services, tax shall be levied on the difference.

Intermodal transport refers to the transportation service in which two or more transport enterprises jointly carry passengers or goods from the point of origin to the destination. The turnover for intermodal transport is calculated based on the actual revenue received, namely, the balance remaining after deducting from the total revenue amounts paid to subsequent carriers for freight, handling charges, transshipment fees, and other related expenses. “Notice of the State Administration of Taxation on Issues Concerning the Use of the New‑Version Unified Invoice for Road and Inland Waterway Freight Transport” ( National Taxation send [2007] No. 101 stipulates that joint road–inland waterway freight transport refers to a freight transport operation in which a single shipment is jointly carried out by two or more transport entities (or individuals). The transporting entity (or individual) shall issue a freight invoice to the payer based on the total price received, while the cooperating transport entity (or individual) shall issue a freight invoice to the transporting entity (or individual) based on the total price it has collected from the latter. Furthermore, the transporting entity (or individual) must use the freight invoice issued by the cooperating transport entity (or individual) as supporting documentation for deducting the taxable base when paying business tax on the difference. With respect to logistics enterprises that self‑issue invoices and engage in combined transport operations, as well as enterprises engaged in freight transport, Demolition and relocation 、 Intellectual property Revenue derived from advertising and exhibition agency services is subject to business tax on a net‑basis.