On 7 June 2017, senior officials and representatives of 67 jurisdictions (including Mainland China, who also represented Hong Kong SAR) gathered in Paris to participate in the signing ceremony for the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting or the Multilateral Instrument (MLI). The provisional MLI position for each signing jurisdiction is now published on the website of the Organization for Economic Cooperation and Development (OECD).
In 2014, the Global Forum endorsed the new common reporting standard on automatic exchange of financial account information (AEOI). Jurisdictions that have publicly committed to implementing the AEOI standard on a timeline will first exchange tax information in 2017 or 2018. The Global Forum, in collaboration with the OECD, has been working hard to support these commitments. China (as well as Hong Kong) fall within the jurisdictions undertaking first exchanges in 2018. The first information exchange involving China will occur by September 2018.
Last week Hong Kong lawmakers passed several tax measures announced in the Budget for 2017-18 that are expected to reduce Hong Kong tax revenue by 2 billion HKD.
The following changes have been implemented, commencing from the year of assessment 2017/18:
Since 1 May 2016, Business Tax has no longer been under China’s indirect tax regime and this signifies the completion of the B2V Reform in China. The VAT chain in China is completed for largely all industries and taxpayers could claim VAT credit for the purchase of tangible goods, immovable properties, intangibles and most services.