Pre-tax deduction policy

(I) Pre-tax deduction policy for corporate donations for poverty alleviation

Key points of the policy: From January 1, 219 to December 31, 222, enterprises used public welfare social organizations or people's governments at or above the county level (including county level) and their constituent departments and directly affiliated institutions for poverty alleviation expenditures, which are allowed to be deducted when calculating taxable income. During the implementation period of the policy, the above policies can continue to be applied to areas that have achieved poverty alleviation. When the poverty alleviation donation expenditure and other public welfare donation expenditure occur at the same time, the eligible poverty alleviation donation expenditure is not counted in the annual deduction limit of public welfare donation expenditure. During the period from January 1, 215 to December 31, 218, enterprises can also implement the pre-tax factual deduction policy of enterprise income tax for eligible poverty alleviation donations that have not been deducted.

Policy basis: Announcement of the the State Council Poverty Alleviation Office of the State Administration of Taxation of the Ministry of Finance on the Pre-tax Deduction Policy for Corporate Donations for Poverty Alleviation (Announcement No.49 of 219 of the the State Council Poverty Alleviation Office of the Ministry of Finance)

(II) Deduction Policy for Fee and Commission Expenses of Insurance Enterprises

Policy Highlights: From January 1, 219, the pre-tax deduction limit for fee and commission expenses of insurance enterprises is 18% of the balance of all premium income in the current year after deducting surrender fees; The excess is allowed to be carried forward to the next year for deduction.

Policy basis: Announcement of the Ministry of Finance and the State Administration of Taxation on Pre-tax Deduction Policy for Fees and Commissions of Insurance Enterprises (Announcement No.72 of the Ministry of Finance and the State Administration of Taxation in 219)

(III) Pre-tax Deduction Policy for Enterprise Income Tax of Loan Loss Reserve for Financial Enterprises

Policy Highlights: From January 1, 219 to December 31, 223, the relevant policies on pre-tax deduction of enterprise income tax for loan loss reserve for financial enterprises will continue to be implemented.

from January 1, 219 to December 31, 223, we will continue to implement the policy of withdrawing and deducting loan loss reserves after financial enterprises classify their agricultural loans and SME loans according to the provisions in the Notice on Relevant Issues Concerning Pre-tax Deduction of Loan Loss Reserves of Financial Enterprises (Caishui [215] No.3).

if a financial enterprise implements the policy of pre-tax deduction of loan loss reserve for agriculture-related loans and small and medium-sized enterprises according to the announcement of the Ministry of Finance and the State Administration of Taxation on relevant policies of pre-tax deduction of loan loss reserve for financial enterprises (Announcement No.85 of the Ministry of Finance and the State Administration of Taxation in 219), Articles 1 to 4 of the Announcement of the Ministry of Finance and the State Administration of Taxation on relevant policies of pre-tax deduction of enterprise income tax for loan loss reserve for financial enterprises (Announcement No.86 of the Ministry of Finance and the State Administration of Taxation in 219) will no longer apply to the loan loss reserve.

Policy basis: Announcement of the Ministry of Finance and the State Administration of Taxation on Relevant Policies for Pre-tax Deduction of Corporate Income Tax for Loan Loss Reserves of Financial Enterprises (Announcement No.86 of the Ministry of Finance and the State Administration of Taxation in 219)

Announcement of the Ministry of Finance and the State Administration of Taxation on Relevant Policies for Pre-tax Deduction of Loan Loss Reserves for Agricultural Loans of Financial Enterprises and Small and Medium-sized Enterprises (Announcement No.85 of the Ministry of Finance and the State Administration of Taxation in 219)

(4) In Shanghai International Energy Trade, Pre-tax deduction policy for expenditures such as mental risk reserve

Policy key points: From January 1, 219 to December 31, 22, the risk reserve set aside by Shanghai International Energy Exchange Center according to relevant regulations at 2% of the fee income collected from its members is allowed to be deducted before the enterprise income tax when the balance of the risk reserve reaches the relevant provisions; The futures investor protection fund, which is paid at 2% of the transaction fee charged to the members of the futures company, is allowed to be deducted before enterprise income tax when the total amount of the fund reaches the relevant provisions; If the above reserves are liquidated or returned, enterprise income tax shall be levied according to the regulations.

Legal basis:

Law of the People's Republic of China on the Administration of Tax Collection

Article 1 This Law is formulated in order to strengthen the administration of tax collection, standardize the tax collection and payment, safeguard the national tax revenue, protect the legitimate rights and interests of taxpayers and promote economic and social development.

article 2 this law is applicable to the collection and management of various taxes collected by tax authorities according to law.

article 3 the collection and suspension of taxes, as well as the reduction, exemption, refund and overdue tax, shall be implemented in accordance with the provisions of the law; Where the State Council is authorized by law, it shall be implemented in accordance with the administrative regulations formulated by the State Council.

no organ, unit or individual may, in violation of the provisions of laws and administrative regulations, arbitrarily make decisions on tax collection, suspension, tax reduction, exemption, tax refund, overdue tax and other decisions that are in conflict with tax laws and administrative regulations.

article 4 units and individuals who are obligated to pay taxes as stipulated by laws and administrative regulations are taxpayers.

units and individuals who are obligated to withhold and remit taxes and collect and remit taxes are withholding agents according to laws and administrative regulations. Taxpayers and withholding agents must pay taxes, withhold taxes and collect taxes in accordance with the provisions of laws and administrative regulations.