It is reported by SECURITIES DAILY (note: the link is in Chinese) that there will be adjustment on tax policy in China animation industry. In recent, China Ministry of Finance and the State Administration of Taxation jointly issued a new policy supporting the animation industry, which introduces the VAT and the preferential business tax. And less tax and taxation of the both VAT and business tax will be made hereby.
I. For the sales of the independently developed animation software by the company of the general tax payer itself, the VAT shall be levied at the rate of 17% first, and the exceeding 3% amount of the actual tax bearing will be refunded. That’s the so called levy-refund policy.