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(Sep 12, 2012) It was reported on September 10, 2012, that China's State Administration of Taxation (SAT) has issued an announcement that introduces the imposition of a surcharge on electronic waste in the country. (Shiqi Ma, Surcharge on Electronic Waste Introduced, TAX NEWS SERVICE (Sept. 10, 2012), International Bureau of Fiscal Documentation on line subscription database.) The announcement sets forth the new Provisions for the Administration of the Collection of the Fund for the Disposal of Waste Electrical and Electronic Products of August 20, 2012, retroactively effective as of July 1, 2012. (Announcement on Issuance of the Provisions for Administration of Collection of the Fund for the Disposal of Waste Electrical and Electronic Products [in Chinese] [hereinafter Provisions], SAT Announcement No. 41 of 2012 (Aug. 20, 2012), SAT website.)

The new Provisions are based on recently adopted measures issued jointly by the Ministry of Finance, the Ministry of Environmental Protection, the National Development and Reform Commission, the Ministry of Industry and Information Technology, the General Administration of Customs, and the State Administration of Taxation on May 21, 2012, and which also took effect on July 1, 2012. (Circular on Printing and Issuing the Measures for the Management of the Collection and Use of a Fund for the Disposal of Waste Electrical and Electronic Products [in Chinese] [2012] No. 34, (May 21, 2012), Ministry of Finance of the People's Republic of China website.)

Establishment of the dedicated fund is provided for under article 7 of the 2009 Regulations for the Administration of the Recovery and Disposal of Waste Electric and Electronic Products. (See Wendy Zeldin, China: Regulations on Electronic Waste, GLOBAL LEGAL MONITOR (Apr. 24, 2009).)

According to the Provisions, all manufacturers of electrical and electronic products in China are fund payment obligors and must contribute to a fund for the disposal of electrical and electronic waste with retroactive effect. (Provisions, art. 2; Shiqi Ma, supra.) The manufacturers must file a special tax return for this purpose and pay the fees to their local tax authority, but the SAT is responsible for overall collection of the surcharge. (Ma, supra.) The formula for calculating the amount due is: the fund payment = the number of items sold (or processed), multiplied by the surcharge standard (Provisions, art. 7 (see also the rates listed below)). Manufacturers that export electrical and electronic products are exempt from payment of the surcharge, however (Provisions, art. 9, supra).

The scope of collection and collection standards of the fund are to be carried out in accordance with the Scope and Standards for Fund Collection of Domestic Market Electrical and Electronic Products, which are appended to the Provisions as Annex I. The surcharge rates listed in that document for various types of waste equipment are, with 1 yuan equal to about US$0.16:

Televisions, 13 yuan/unit (5 types listed, with catch-all)

Refrigerators, 12 yuan/unit (4 types listed, with catch-all)

Washing machines, 7 yuan/unit (5 types listed, with catch-all)

Air conditioners, 7 yuan/unit (4 types listed, with catch-all)

Microcomputers, 10 yuan/unit (4 types listed, with catch-all)

Author: Wendy Zeldin More by this author
Topic: Taxation More on this topic
Jurisdiction: China More about this jurisdiction

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Last updated: 09/12/2012