China will complete its plan to replace the business tax with a value-added tax (VAT) for the services sector in 2016, the official state news agency Xinhua reported Monday.
VAT reform will be implemented across all the remaining industries of finance, construction, property, and consumer services Xinhua said, quoting Lou Jiwei, head of the Ministry of Finance.
The program began in 2012 on a trial basis applicable to transportation and modern services industries in Shanghai and has been gradually been expanded to include more regions and other industries.
According to the news agency, VAT reform is expected to result in a decreased tax burden for companies and may encourage increased outsourcing of services to China.
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