SABIC explains how to get the most from China
01 June 2012
Jack Grocott speaks to Watson Wang, SABIC’s new head of Asia-Pacific tax, about the role of a tax director in China, how to create certainty and to manage effectively a working relationship with the increasingly aggressive tax officials.
International Tax Review: What are the three biggest challenges/risks facing taxpayers in China?
Watson Wang: 1: Withholding tax position on overseas indirect share transfers: In China all multinationals feel uncertainty on the withholding tax on overseas indirect share transfers, after the release of circulars 698 and 601. There are an increasing amount of cases where these transfers have been taxed. Though Vodafone in India went in favour of taxpayer, the State Administration of Taxation's (SAT) comments is that India lost that case because they do not have circular 698!
2. Transfer pricing: On the one side, the SAT has put more focus on transfer pricing documentation and transfer pricing audit, while on the other, there are more than 100 APA case queued up for SAT officers review, among which only eight were concluded in 2010, due to lack of resources at the SAT level.
3. Overall increasing tax cost...
This article is available to subscribers and current trialists of International Tax Review only. Please log in or subscribe for access to the rest of the article.
Alternatively take a free trial, giving you 7 days of access.
This article is available to subscribers only. To read the rest of this article please subscrbe.
This article is available to trialists and subscribers only. Please take a free 7 day trial to read the rest of the article.