Logistics enterprises are fundamentally different from express carriers. The logistics are usually more than 30 kg by the weight of the goods received; the logistics are generally personal by the client and the logistics are generally business; the delivery mode is followed by the end-of-the-way mode, where the delivery can generally be delivered to the home, while logistics generally does not send the goods to the door; the delivery is timely, depending on the storage, which is timely and followed by the logistics warehousing。
Since both types of business involve transport operations (except express couriers), it is still customary to refer to both types of business as logistics enterprises. As a result of the increase in the number of battalions, different rates were applied to transport operations and to receiving operations, which created tax-related risk points for logistics enterprises in five areas that required attention。
One is confusing income categories
Pilot implementation scheme for conversion of business tax to value added tax (customs) [2016] annex 1 provides that ordinary taxpayers shall be taxed at the rate of 11 per cent for transport services and 6 per cent for logistics support services. At the same time, the document states: “transport services are operations involving the transport of goods or passengers to their destination and the transfer of their space positions, including land transport services, water transport services, air transport services and pipeline transport services. Logistics support services include air services, port terminal services, cargo terminal services, salvage services, loading and unloading services, warehousing services and reception services”. Some logistics enterprises deliberately confuse income categories, declare transport operations as logistics support services, and pay less vat, resulting in a significantly lower tax burden for enterprises, or even long-term tax credits。
Second, the invoice was wrong
Article 22 of the invoice management scheme provides that invoices shall be issued in full and on a one-time basis, in accordance with the time limit, order and column specified, and that the invoice shall be stamped with a special stamp. Circular of the state revenue service on the revision of the regulations on the use of specialized invoices for value added taxes [2006] article xi provides that specialized invoices shall be issued in full conformity with the actual transaction. Some logistics enterprises, however, take advantage of the fact that most of their customers transport goods on a piecemeal basis, which is small in amount and less serious in psychological terms, or use customers' ignorance of tax laws to assume that the transport of goods on a piecemeal basis is a logistics auxiliary service, and that the “transportal services” project is not invoiced as required, creating the risk of false billing。
Third is the inaccuracy of revenue accounting
Provisions on matters related to the pilot conversion of turnover tax to value added tax (fiscal tax [2016] annex 2 provides for the option of a simple method of tax collection for a general taxpayer. Therefore, logistics enterprises need to account separately for simple tax items from general tax items, accounting separately for sales at different rates or rates of collection, and higher rates if not. Some logistics enterprises, however, do not account separately for different business turnovers, but tax all or most of the charges, including courier fees and freight charges, as assignment services。
Four is hiding sales services
As a general rule, the courier fee consists of receipt, transportation and delivery charges, while the express delivery fee is a one-time charge requiring the settlement of the assignment fee between express general and the union. Owing to the problem of the identity of union taxpayers, the use of simple tax collection schemes by general taxpayers has made it difficult for some couriers to obtain a credit for vat-specific invoices or to obtain insufficient credit for vat-specific invoices, and some taxpayers have simply resorted to concealing sales services by off-the-booking settlement when settling with unions。
Five is an incomplete accounting of the value of the tax
Logistics enterprises have both simple and general methods of collection. Pilot implementation scheme for conversion of business tax to value added tax (customs) [2016] article 27 of annex no. 36 provides that no deduction may be made from the amount of the tax to be paid for the purpose of a simple tax collection. Some logistics enterprises, however, do not properly divide the amount of the inflow tax and risk oversetting the amount of the inflow。
