State Administration of Taxation "Administrative Measures for Exemption of Value Added Tax and Consumption Tax on Off-Island Duty-Free Goods Sold by Off-Island Duty-Free Shops in Hainan"

Article 1 These Measures are formulated in accordance with the Tax Collection and Management Law of the People's Republic of China and the Notice of the Ministry of Finance and the State Administration of Taxation on the Value-Added Tax and Consumption Tax Policies for Exported Goods and Services (Caishui [2012] No. 39) and other relevant provisions in order to standardize the management of value-added tax and consumption tax on the sale of duty-free goods by Hainan offshore duty-free shops (hereinafter referred to as "offshore duty-free shops") and promote the construction of Hainan Free Trade Port.
Article 2 Offshore duty-free shops selling duty-free goods are exempt from value-added tax and consumption tax in accordance with the provisions of these Measures.
Article 3 Offshore duty-free shops shall file monthly value-added tax and consumption tax returns. When filing tax returns for the first time, they shall provide the following information to the competent tax authorities:
(I) Basic information on the operating entity of the offshore duty-free shops.
(II) Relevant materials on the establishment of offshore duty-free shops approved by the state (including duty-free shops approved by the Hainan Provincial People's Government in accordance with relevant regulations and filed with relevant state ministries and commissions).
Article 4 If the content of the report submitted by the offshore duty-free shops in accordance with Article 3, Item 1 of these Measures changes, they shall report the relevant situation to the competent tax authorities during the tax declaration period of the next month and provide relevant information. If the offshore duty-free shop's qualification for implementing the offshore duty-free policy expires or its offshore duty-free business qualification is revoked, it shall report the relevant situation to the competent tax authority within 15 days after the expiration of the period or the revocation of the qualification.
Article 5 Off-island duty-free shops selling non-off-island duty-free goods shall declare and pay value-added tax and consumption tax to the competent tax authority in accordance with the current regulations.
Article 6 Off-island duty-free shops that concurrently operate items subject to value-added tax and consumption tax shall separately account for the sales of offshore duty-free goods and taxable items; if they fail to account separately, they shall not be tax-free.
Article 7 Off-island duty-free shops shall issue ordinary value-added tax invoices for the sale of offshore duty-free goods, and shall not issue special value-added tax invoices.
Article 8 Off-island duty-free shops shall provide the names and sales prices of offshore duty-free goods sold, the information of offshore passengers who purchase offshore duty-free goods, and other information required by the tax authorities in a complete, accurate and real-time manner to the tax authorities in accordance with the reporting format and transmission method specified by the State Administration of Taxation and the Hainan Provincial Taxation Bureau.
Article 9 Off-island duty-free shops that have already started operating off-island duty-free goods before the implementation of these Measures shall provide relevant information when filing tax returns in accordance with the requirements of Article 3 of these Measures in the month following the implementation of these Measures.
Article 10 These Measures shall come into force on November 1, 2020.