VAT non-taxable items include the following:

1. Non-VAT taxable services: refers to the transportation, construction, and construction industries that taxpayers engage in that are subject to business tax. Finance and insurance industry, postal and telecommunications industry, culture and sports industry, entertainment industry and service industry labor services;

2. Transfer of intangible assets: refers to the transfer of patent rights, non-patented technologies, trademark rights, copyrights, and land use rights Income generated from intangible assets such as;

3. Real estate: refers to property that cannot be moved or that will cause changes in nature and shape after being moved, including buildings, structures and other land attachments;

< p>4. Real estate construction in progress: refers to the construction, reconstruction, expansion, repair, and decoration of the above-mentioned real estate;

5. Sales of real estate: refers to the act of selling the above-mentioned real estate.

Tax-free items include:

1. Self-produced agricultural products sold by agricultural producers, specifically those directly engaged in planting, breeding, forestry, animal husbandry, and aquaculture. Units and individuals sell self-produced agricultural products that fall within the scope of tax laws;

2. Contraceptives and appliances;

3. Ancient books refer to ancient and used books purchased from the public;

4. Selling used items

5. Imported instruments and equipment directly used for scientific research, scientific experiments and teaching;

6. Foreign Imported materials and equipment provided with free assistance from the government and international organizations;

7. For domestic investment projects that comply with the requirements of national industrial policies, self-use equipment imported within the total investment amount (except for a few commodities that are not exempt from tax exemption under special regulations) );

8. Disabled persons’ organizations directly import items intended for use by persons with disabilities.

To sum up, the taxable items of value-added tax are non-taxable items of business tax, and the taxable items of business tax are non-taxable items of value-added tax. In other words, an economic activity is either subject to value-added tax or business tax.

Legal basis:

Article 4 of the "Interim Regulations of the People's Republic of China on Value-Added Tax"

Except for the provisions of Article 11 of these Regulations, When a taxpayer sells goods, labor, services, intangible assets, and real estate (hereinafter collectively referred to as taxable sales), the tax payable is the balance after the current output tax is deducted from the current input tax. The formula for calculating the tax payable:

The tax payable = the output tax for the current period - the input tax for the current period

When the output tax for the current period is less than the input tax for the current period and is insufficient for deduction, the shortfall can be settled The deduction will continue to be transferred to the next period.

Article 6

Sales are all prices and extra-price expenses collected by taxpayers for taxable sales, but do not include the output tax collected.

Sales are calculated in RMB. If a taxpayer settles sales in a currency other than RMB, it shall be converted into RMB for calculation.