Fee-payingobjects
Paidpayersareunitsandindividualswhopayvalue-addedtax,consumptiontax,andbusinesstax.Theyareallpayersofadditionaleducationfees(referredtoaspayers).SinceDecember1,2010,inaccordancewiththe"NoticeoftheStateCouncilonUnifyingtheUrbanMaintenanceandConstructionTaxandEducationalSurchargeSystemforDomesticandForeignEnterprisesandIndividuals"(GuoFa[2010]No.35),foreign-investedenterprises,foreignenterprisesandforeignindividualsThe"InterimProvisionsontheLevyofEducationalSurcharges"promulgatedbytheStateCouncilin1986areapplicable.Unitsandindividualsthatcollectvalue-addedtax,consumptiontax,andbusinesstaxontheirbehalfarealsoobligorstocollectadditionaleducationfees.Foragricultureandtownshipenterprises,theruraleducationsurchargeshallbeleviedbythetownshippeople’sgovernment,andnoadditionaleducationfeesurchargeshallbelevied.
Thescopeoflevy
Thescopeoflevyisthesameasthatofvalue-addedtax,consumptiontax,andbusinesstax.
Levyrate
Thelevyrateforeducationsurchargeis3%.
Calculationoffeeamount
(1)Chargingbasis:
Thechargingbasisisbasedontheactualvalue-addedtax,consumptiontax,andbusinesstaxpaidbythetaxpayer.
(2)Calculationformula:
Additionalpayableeducationfee=(theactualamountofvalue-addedtax,consumptiontax,andbusinesstaxpaid)×3%
AccordingtoCaishui[2005]No.25:SinceJanuary1,2005,afterthefullimplementationoftaxexemption,creditandrebatemeasuresforexportgoodsofproductionenterprises,thecurrentvalue-addedtaxexemptionthathasbeenformallyreviewedandapprovedbytheStateAdministrationofTaxationshallbeincludedinthecityThecalculationscopeofmaintenanceandconstructiontaxandeducationsurchargeshallbeleviedonurbanmaintenanceandconstructiontaxandeducationsurchargeattheprescribedtax(fee)raterespectively.
BeforeJanuary1,2005,theurbanmaintenanceandconstructiontaxandeducationalsurchargesthathavebeenleviedontheexemptedvalue-addedtaxamountwillnolongerberefunded,andthosethathavenotbeenleviedwillnolongerbelevied.
Sothevalue-addedtaxpartintheformulashouldalsoaddtheamountoftaxexemptionandcreditresultingfromtheimplementationofthetaxexemptionandrefundmethodforexportgoodsoftheproductionenterprise;ifthereisataxexemptionamountinthecurrentperiod,itisgenerallyinthesummarytableoftheproductionenterprise'sexemptionandrefundItwillbereflectedinit.
Thecalculationformulafortheadditionaleducationfeeofamanufacturingenterprisethatimplementsexemptionandcreditshouldbe:
Theadditionaleducationfeepayable=(VATpayable+currenttaxexemption+consumptiontax+Businesstax)*3%
Educationalsurcharge
OnJuly1,2011,theChinaGovernmentwebsiteannouncedthe"OpinionsoftheStateCouncilonFurtherIncreasingFinancialEducationInvestment".The"Opinions"requirethatlocaleducationsurchargesbefullylevied,andallregionsmuststrengthenrevenuecollectionandmanagement,andlevyinfullinaccordancewiththelaw,withoutarbitrarilyreducingorexemptingthem.
The"NationalMediumandLong-termEducationReformandDevelopmentPlan(2010-2020)"approvedbytheexecutivemeetingoftheStateCouncilinMay2010clearlystatedthatby2012,thenationalfinancialeducationexpenditurewillaccountfordomesticproduction.Thetotalvalueratioreachesthegoalof4%.Inordertoensurethatthisgoalisachievedonschedule,theStateCouncilrecentlyissueditsopinionsonfurtherincreasingfinancialinvestmentineducation.
The"Opinions"proposestobroadenfundingsourcesandraisefinancialeducationfundsfrommultiplesources.Thespecificrequirementsareasfollows:
——Unifythesurchargesystemofdomesticandforeignenterprisesandpersonaleducationfees.TheStateCouncildecidedtounifytheurbanmaintenanceandconstructiontaxandeducationsurchargesystemfordomesticandforeignenterprisesandindividualsfromDecember1,2010,andtheeducationsurchargewillbeleviedat3%oftheactualtaxpaymentofvalue-addedtax,consumptiontax,andbusinesstax.
——Afull-scalerecruitmentoflocaleducationsupplements.Thepeople’sgovernmentsofallprovinces(autonomousregionsandmunicipalities)shall,inaccordancewiththerelevantprovisionsoftheEducationLawofthePeople’sRepublicofChinaandtherequirementsofthe“NoticeoftheMinistryofFinanceonIssuesConcerningtheUnificationofAdditionalLocalEducationPolicies”(CaiZong[2010]No.98),fullyopenlocalgovernments.Educationaladd-on.Localeducationsurchargesareuniformlyleviedat2%oftheactualtaxpaidforvalue-addedtax,consumptiontax,andbusinesstax.
——Accordingtotheproportionofeducationfundsfromthelandtransferproceeds.Furtheradjustthedirectionoftheuseoflandtransferproceeds.StartingfromJanuary1,2011,allregionsshalldeduct10%ofthelandtransferincomeobtainedfromthetransferofstatelanduserightsthroughbidding,auction,listingoragreementinthesameyearasthebalanceafterdeductionoflandacquisitionanddemolitioncompensation,landdevelopmentandotherexpenses.Theproportionofeducationfundsisaccrued.ThespecificmeasuresshallbeformulatedbytheMinistryofFinanceinconjunctionwithrelevantdepartments.
The"Opinions"pointedoutthatallregionsshouldstrengthenthecollectionandmanagementofincome,levyinfullinaccordancewiththelaw,andshallnotarbitrarilyreduceorexemptthem.
The"Opinions"pointedoutthattheincreaseinrevenuefromtheimplementationoftheabovepoliciesmustbeusedtosupportthedevelopmentoflocaleducationinaccordancewithregulations.Atthesametime,othereducationfundsthatshouldbearrangedbythepublicfinancialbudgetshouldnotbereduced.