China’s Current Tax System – Fixed Assets Investment Orientation Regulation Tax

(1) Taxpayers

This tax is imposed on enterprises, units, individual household businesses and other individuals who invest into fixed assets within the territory of the People’s Republic of China (excluding enterprises with foreign investment, foreign enterprises and foreigners).

(2) Taxable items and tax rates

Table of Taxable Items and Tax Rates

Taxable Items Tax Rates
A. Infrastructure

1. State urgent projects

2. Projects encouraged by the State but restricted by the condition of transportation and energy

3. Office buildings, hotels and guest houses

4. Residential buildings (including commercial residential buildings)

5. Other







B. Renewal and transformation projects

1. State urgent projects (same as infrastructure)

2. Other renewal and transformation projects



(For some residential building investment projects, the rate is 5%.)

(3) Computation of tax payable

This tax is based on the total investment actually put into fixed assets. For renewal and transformation projects, the tax is imposed on the investment of the completed part of the construction project. The formula for calculating the tax payable is:

Tax payable – Amount of investment completed or amount of investment in construction project x Applicable rate