Urban Maintenance and Construction Tax Law of the People's Republic of China

Urban Maintenance and Construction Tax Law of the People's Republic of China (Adopted at the 21st Meeting of the Standing Committee of the Thirteenth National People's Congress on August 11, 2020)

Article 1

The entities and individuals that pay value-added tax (VAT) or excise tax within the territory of the People's Republic of China are taxpayers of urban maintenance and construction tax, and shall pay urban maintenance and construction tax in accordance with the provisions of this Law.

Article 2

The tax basis of urban maintenance and construction tax shall be the amount of VAT or excise tax actually paid by taxpayers in accordance with law.

The refunded amount of end-of-period excess input VAT shall be deducted pursuant to relevant regulations from the tax basis of urban maintenance and construction tax.

The specific measures for calculating the tax basis of urban maintenance and construction tax shall be stipulated by the State Council in accordance with this Law and relevant tax laws and administrative regulations, and shall be submitted to the Standing Committee of the National People's Congress for the record.

Article 3

No urban maintenance and construction tax shall be levied on the amount of VAT or excise tax paid for imported goods, or for rendering services and intangible assets within the territory of the People's Republic of China by entities and individuals elsewhere.

Article 4

The urban maintenance and construction tax rates shall be:

(1) 7% for taxpayers the domiciles of which/who are in urban areas;

(2) 5% for taxpayers the domiciles of which/who are in county or township centers; or

(3) 1% for taxpayers the domiciles of which/whom are in places other than urban areas, county and township centers.

“Domicile” as prescribed in the preceding paragraph refers to a taxpayer’s place of residence or places in relation to a taxpayer’s production and operations. The domicile shall be determined by provinces, autonomous regions and municipalities directly under the Central Government.

Article 5

The amount of urban maintenance and construction tax payable shall be calculated by multiplying the tax basis by the specific applicable tax rate.

Article 6

The State Council may, according to the needs of national economic and social development, stipulate the reduction or exemption of urban maintenance and construction tax with respect to circumstances of construction of major public infrastructure, special industries and groups, responses to major emergencies, etc., and shall submit such stipulations to the Standing Committee of the National People’s Congress for the record.

Article 7

The time when the obligation to pay urban maintenance and construction tax arises shall coincide with that of VAT or excise tax, and urban maintenance and construction tax shall be paid simultaneously with VAT or excise tax respectively.

Article 8

The withholding agent of urban maintenance and construction tax shall be the entities or individuals that are obliged to withhold VAT or excise tax, and shall withhold urban maintenance and construction tax simultaneously with VAT or excise tax.

Article 9

The administration of the collection of urban maintenance and construction tax shall be conducted by tax authorities in accordance with the provisions of this Law and the Law of the People’s Republic of China on the Administration of Tax Collection.

Article 10

Where taxpayers, tax authorities and their staff violate the provisions of this Law, their legal liabilities shall be investigated in accordance with the Law of the People’s Republic of China on the Administration of Tax Collection and other relevant provisions of laws and regulations.

Article 11

This Law shall enter into force on September 1, 2021, and the Provisional Regulations on Urban Maintenance and Construction Tax of the People’s Republic of China promulgated by the State Council on February 8, 1985 shall be repealed at the same time.