As highlighted in KPMG China Tax Weekly Update (Issue 18, May 2017), on 28 April 2017 the Ministry of Finance (MOF), the State Administration of Taxation (SAT) and the Ministry of Science and Technology (MOST) jointly issued Cai Shui  No. 34, which clarifies that:
The recognition criteria and administrative measures for “science and technology-related SMEs” now have been separately promulgated by MOST, MOF and SAT, with the issuance of Guo Ke Fa Zheng  No. 115 (“Circular 115”) on 3 May 2017. These measures clarifiy, inter alia, that:
* Detailed analysis of the recognition criteria and administrative measures for “science and technology-related SMEs” are set out in KPMG " China Tax Alert: (Issue 14, May 2017).
On 2 May 2017, the SAT issued Announcement  No.12 (“Announcement 12”) to guide taxpayers how to fill in the relevant filing forms for enterprises enjoying the R&D expense “super deduction” when performing CIT annual filing for year 2016.
* For more information about the R&D “super deduction” policy, you may access the following KPMG publications:
As highlighted in KPMG China Tax Weekly Update (Issue 7, February 2017), the Standing Committee of the State Council 8 February 2017 had committed to further reduce and regularize business charges to lower the corporate fiscal burden. To this end, on 25 April 2017, the National Development and Reform Commission (NDRC), MOF, Ministry of Industry and Information Technology (MIIT) and Ministry of Civil Affairs (MCA) jointly issued Fa Gai Jia Ge  No. 790. This clarfies the implementation issues for reducing and regularizing business charges:
OECD launches facility to disclose CRS avoidance schemes
Per a posting to the OECD website on 5 May 2017, the OECD is launching a disclosure facility on its Automatic Exchange Portal which allows interested parties to report potential schemes to circumvent the Common Reporting Standard (CRS). This is part of a wider three step process the OECD has put in place to deal with schemes that purport to avoid reporting under the CRS, which also includes requirements for CRS participant jurisdictions to put in place anti-abuse rules to prevent any practices intended to circumvent the reporting and due diligence procedures. This complements the ongoing peer reviews carried out by the Global Forum on Tax Transparency and Exchange of Information for Tax Purposes to ensure the effective implementation of the CRS in all jurisdictions. China, as a CRS participant, is engaged with all the above measures.
Over 1800 bilateral exchange relationships for CRS in place
The same OECD news posting observed that there are now over 1800 bilateral relationships in place across the globe, most of them based on the Multilateral Competent Authority Agreement on Automatic Exchange of Financial Account Information ("the CRS MCAA"), to which China is also a signatory. The full list of automatic exchange relationships that are currently in place under the CRS MCAA is available online. With respect to the jurisdictions exchanging as of 2017, now virtually all have activated their relationships under the CRS MCAA, while a significant number of new exchange relationships have now been put in place with respect to 2018 jurisdictions. The remaining exchange relationships are expected to be activated in the course of this year, including those of China which have not yet been notified.
A further activation round is scheduled to take place in July 2017 which will allow the remaining jurisdictions to nominate the partners with which they will undertake automatic exchanges.
In total, 100 jurisdictions have agreed to start automatically exchanging financial account information in September 2017 and 2018, under the CRS.
* In September 2014, China committed to implement the OECD CRS for Automatic Exchange of Financial Account Information in Tax Matters. China is expected to engage in the first information exchange in September 2018. China subsequently signed the CRS MCAA and is in the process of developing domestic CRS guidance for financial institutions, a draft of which was publicised in November 2016.
With regard to the impact of the Discussion Draft on China tax management, you may click the following links to access the relevant analysis by KPMG: