VAT
All aspects of the value-added tax is based on commodity production and circulation of labor services as a value added tax object of taxation.
VAT is a value-added tax rate for the commodity portion (ie "gross") levied. Production operator received from the purchaser extra, to be deducted on a link when purchasing tax, the difference to the State.
Let's give an example:
A textile fabrics to sell 100 million garment factory B, B to these garment factory processed into clothing fabrics, 2 million yuan sold to large shopping centers C, C to these large shopping malls clothing sold three million yuan a large enterprise D.
The following tax calculations links:
For convenience of calculation, is not calculated A textile proceeds. Because some mills may not use the proceeds from ticket deductible, may be deducted from agricultural products.
Textile A:
VAT output tax gold 100 * 17% = 17 million. Issue special invoices, gold 170,000 yuan of output tax.
Garment factory B:
Gold output tax is 200 * 17% = 340,000, issuing VAT invoices, gold 340,000 yuan of output tax. A textile mill open to the garment factory B VAT invoices input tax 170,000 170,000 garment factory B deductible, the actual garment factory B VAT 170 000.
Great Mall C:
Gold output tax is 300 * 17% = 510,000, issuing VAT invoices, gold 510,000 yuan of output tax. B deductible garment factory issued VAT invoices input tax 340 000, large shopping malls C VAT actually paid 170,000 yuan.
We have not found in the circulation of the AC, is that 17% of the difference between the purchase cost and the selling price of their respective AC of the VAT, what we call profit x17%.
This is the deductible VAT on the downstream, it can be said that the deductible chain design is very tight, very beautiful. Because the downstream demand deductible input tax, the tax will be invoiced Forced upstream industry.
Let us look at the last part D, D big companies spent 300 million to buy a batch of clothing, if D for its own use, not resale, then D on the real deal to pay 3 million (includes VAT paid by C ). The D is actually our daily lives of consumers.
So 16% value-added tax from 17% to this policy is to promote consumption, increase production and sales managers, so that producers and operators earn more, so that more active economic prosperity.