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Tuesday, 14 October 14
THE NEW CHINESE TRANSPORTATION TAX LAW: WHAT DOES IT MEAN FOR GREEK SHIPPING? - DELOITTE
 China has recently promulgated a new law which imposes tax on profits from freights of inbound routes. The objective of the new tax law titled “Provisional Measures on the Collection of Tax on Non-Resident Taxpayers Engaged in International Transportation Business” (Bulletin of the State Administration of Taxation 2014, No. 37) is to strengthen the tax administration of foreign companies operating international transportation business with China.
What has changed?
Until recently, China had only been taxing international outbound routes with an effective tax rate of 1.25% on the gross revenue. The new rules extend the scope of the tax to inbound routes, and increase the tax rate. As of August 1st, 2014, freights of non-resident shipping companies operating in international routes towards Chinese ports are expected to pay a new tax rate (Enterprise Income Tax – EIT) of 25% on profit. The tax is levied on freights on voyage charters and time charters.
How will the new tax be collected?
Currently there are three options for collection, however further clarification is expected:
1. Tax registration in China: Non-resident shipping companies will have to register with Chinese tax authorities and comply with local bookkeeping and tax rules. The tax at the rate of 25% will be levied on the declared net profit, or
2. Tax on deemed profit: where the enterprises are unable to calculate and report taxable income accurately, they can register and pay tax on a deemed profit. The profit rate cannot be less than 15% and the tax rate will be 25%. Therefore, for a freight of $100, it will be deemed that there is a $15 profit, for which a 25% tax will be due (therefore an effective tax rate of 3.75%), or
3. Have tax withheld by an agent: instead of registering with the Chinese authorities, a company can pay the tax at the rate of 25% on the assumed 15% profit, by having the tax withheld by the customer or other persons designated by the local tax authorities as withholding agents.
How does this impact Greek shipping?
The Double Taxation Agreement (“DTT”) and the Merchandise Franchise Agreement (“MFA”), which Greece and China have in place, protect Greek shipping companies or non-Greek shipping companies that are managed by Greek management offices by exempting them from any tax on freight transportation income in Chinese ports. It is important to note that the exemption is not automatic; once the Chinese authorities finalize the filing requirements, close attention shall need to be paid to the completion of necessary documentation in order to secure the exemption.
Additionally, the Greek Government is in the process of setting up further safeguards by amending laws related to tax residency certificates in order to ensure that the Greek shipping companies will be exempted from this new levy. In this case, the impact of the new law could only be compliance requirements and not actual tax costs. However, it is still unclear if the DTT and the MFA mentioned above and the submission of the necessary tax residency certificate will have the power to secure shipping companies exemption from this tax law. Deloitte is following closely any development and will keep its clients informed on any news.
Deloitte’s global shipping leader, George Cambanis, commented, “Provided the proposed amendments to the current Greek law enable management offices to obtain the tax residency certificates which would then exempt Greek shipping companies from this new Chinese tax law the only downside to Greek shipping would be the administrative cost of compliance.”
Source: Deloitte / Hellenic Shipping
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Sunday, 09 November 14
CAPE INDEX UP 3.06%; PANAMAX INDEX FELL 4.05%
COALspot.com: The BDI was almost at same levels compared to last week closing or just increased 0.77 pct from last week. The BDI was closed at 1437 ...
Friday, 07 November 14
U.S. PRODUCED 85.60 MILLION SHORT TONS OF COAL IN OCTOBER, UP 2.88% M-O-M
COALspot.com – United States the world's one of the largest coal producers, produced approximately 19.0 million short tons (mmst) of coal ...
Thursday, 06 November 14
THE ATLANTIC HAS REMAINED STRONG WITH A HEALTHY SUPPLY OF NEW CARGOES
Handy
This week has continued its slow trend in both hemispheres and even though rates are a bit up w-o-w it is not a clear sign for any improvem ...
Wednesday, 05 November 14
CAPESIZE SEGMENT ENJOYED FIRMING RATES ACROSS BOTH BASINS
Following a fantastic week in terms of rate performance for Capes, the Dry Bulk market managed to note another positive weekly closing, which stron ...
Wednesday, 05 November 14
SHIPPING MARKET INSIGHT - PANOS TSILINGIRIS
COALspot.com: The steep appreciation in dry bulker values between late 2012 and March 2014 resulted in unrealistically expensive ship values compar ...
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- IEA Clean Coal Centre - UK
- The Treasury - Australian Government
- Ministry of Finance - Indonesia
- Edison Trading Spa - Italy
- Timah Investasi Mineral - Indoneisa
- Altura Mining Limited, Indonesia
- Karaikal Port Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Chamber of Mines of South Africa
- Port Waratah Coal Services - Australia
- Kobexindo Tractors - Indoneisa
- Essar Steel Hazira Ltd - India
- Indika Energy - Indonesia
- Georgia Ports Authority, United States
- Indian Oil Corporation Limited
- Kideco Jaya Agung - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sical Logistics Limited - India
- Mercuria Energy - Indonesia
- Electricity Authority, New Zealand
- Jaiprakash Power Ventures ltd
- Gujarat Sidhee Cement - India
- CIMB Investment Bank - Malaysia
- Krishnapatnam Port Company Ltd. - India
- OPG Power Generation Pvt Ltd - India
- Australian Commodity Traders Exchange
- Chettinad Cement Corporation Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Petron Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Sinarmas Energy and Mining - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Economic Council, Georgia
- Wood Mackenzie - Singapore
- Ind-Barath Power Infra Limited - India
- Singapore Mercantile Exchange
- Siam City Cement PLC, Thailand
- Leighton Contractors Pty Ltd - Australia
- VISA Power Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Parry Sugars Refinery, India
- Lanco Infratech Ltd - India
- Indonesian Coal Mining Association
- Mintek Dendrill Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Indogreen Group - Indonesia
- Global Coal Blending Company Limited - Australia
- Meenaskhi Energy Private Limited - India
- Anglo American - United Kingdom
- Commonwealth Bank - Australia
- Cigading International Bulk Terminal - Indonesia
- Intertek Mineral Services - Indonesia
- Jindal Steel & Power Ltd - India
- Attock Cement Pakistan Limited
- White Energy Company Limited
- Meralco Power Generation, Philippines
- Mjunction Services Limited - India
- Africa Commodities Group - South Africa
- Maheswari Brothers Coal Limited - India
- SMC Global Power, Philippines
- Billiton Holdings Pty Ltd - Australia
- Formosa Plastics Group - Taiwan
- Kapuas Tunggal Persada - Indonesia
- SMG Consultants - Indonesia
- Interocean Group of Companies - India
- International Coal Ventures Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Iligan Light & Power Inc, Philippines
- Bukit Baiduri Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- European Bulk Services B.V. - Netherlands
- Global Green Power PLC Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Gujarat Mineral Development Corp Ltd - India
- Price Waterhouse Coopers - Russia
- London Commodity Brokers - England
- Vijayanagar Sugar Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Rashtriya Ispat Nigam Limited - India
- Antam Resourcindo - Indonesia
- Bayan Resources Tbk. - Indonesia
- Savvy Resources Ltd - HongKong
- Bank of Tokyo Mitsubishi UFJ Ltd
- Independent Power Producers Association of India
- Samtan Co., Ltd - South Korea
- Planning Commission, India
- IHS Mccloskey Coal Group - USA
- Deloitte Consulting - India
- PowerSource Philippines DevCo
- San Jose City I Power Corp, Philippines
- Bharathi Cement Corporation - India
- Bhushan Steel Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Tata Chemicals Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Toyota Tsusho Corporation, Japan
- Bhatia International Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- Eastern Coal Council - USA
- Minerals Council of Australia
- Gujarat Electricity Regulatory Commission - India
- Kalimantan Lumbung Energi - Indonesia
- Eastern Energy - Thailand
- Globalindo Alam Lestari - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Bukit Makmur.PT - Indonesia
- Directorate Of Revenue Intelligence - India
- Thai Mozambique Logistica
- Borneo Indobara - Indonesia
- MS Steel International - UAE
- CNBM International Corporation - China
- Cement Manufacturers Association - India
- Bulk Trading Sa - Switzerland
- Merrill Lynch Commodities Europe
- Aditya Birla Group - India
- Vizag Seaport Private Limited - India
- LBH Netherlands Bv - Netherlands
- Goldman Sachs - Singapore
- SN Aboitiz Power Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- TeaM Sual Corporation - Philippines
- Malabar Cements Ltd - India
- Metalloyd Limited - United Kingdom
- Wilmar Investment Holdings
- Carbofer General Trading SA - India
- PNOC Exploration Corporation - Philippines
- India Bulls Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Ministry of Transport, Egypt
- Grasim Industreis Ltd - India
- Heidelberg Cement - Germany
- Energy Development Corp, Philippines
- Central Java Power - Indonesia
- ICICI Bank Limited - India
- Posco Energy - South Korea
- The University of Queensland
- Global Business Power Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Aboitiz Power Corporation - Philippines
- New Zealand Coal & Carbon
- Trasteel International SA, Italy
- Coastal Gujarat Power Limited - India
- Salva Resources Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Barasentosa Lestari - Indonesia
- Makarim & Taira - Indonesia
- Star Paper Mills Limited - India
- Therma Luzon, Inc, Philippines
- Romanian Commodities Exchange
- Alfred C Toepfer International GmbH - Germany
- Bukit Asam (Persero) Tbk - Indonesia
- Sakthi Sugars Limited - India
- Baramulti Group, Indonesia
- Straits Asia Resources Limited - Singapore
- Latin American Coal - Colombia
- Jorong Barutama Greston.PT - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Asmin Koalindo Tuhup - Indonesia
- Parliament of New Zealand
- South Luzon Thermal Energy Corporation
- PTC India Limited - India
- Siam City Cement - Thailand
- Holcim Trading Pte Ltd - Singapore
- McConnell Dowell - Australia
- Semirara Mining Corp, Philippines
- Sree Jayajothi Cements Limited - India
- Rio Tinto Coal - Australia
- Australian Coal Association
- Videocon Industries ltd - India
- Sindya Power Generating Company Private Ltd
- Ministry of Mines - Canada
- Directorate General of MIneral and Coal - Indonesia
- Electricity Generating Authority of Thailand
- Larsen & Toubro Limited - India
- Orica Australia Pty. Ltd.
- Petrochimia International Co. Ltd.- Taiwan
- Oldendorff Carriers - Singapore
- Medco Energi Mining Internasional
- Orica Mining Services - Indonesia
- Marubeni Corporation - India
- Coalindo Energy - Indonesia
- ASAPP Information Group - India
- Ambuja Cements Ltd - India
- Xindia Steels Limited - India
- Dalmia Cement Bharat India
- Neyveli Lignite Corporation Ltd, - India
- GVK Power & Infra Limited - India
- Renaissance Capital - South Africa
- Riau Bara Harum - Indonesia
- Kepco SPC Power Corporation, Philippines
- GMR Energy Limited - India
- Simpson Spence & Young - Indonesia
- Kumho Petrochemical, South Korea
- Indian Energy Exchange, India
- Bangladesh Power Developement Board
- Central Electricity Authority - India
- Semirara Mining and Power Corporation, Philippines
- Mercator Lines Limited - India
- The State Trading Corporation of India Ltd
- GAC Shipping (India) Pvt Ltd
- Standard Chartered Bank - UAE
- Manunggal Multi Energi - Indonesia
- Thiess Contractors Indonesia
- Agrawal Coal Company - India
- Bhoruka Overseas - Indonesia
- Energy Link Ltd, New Zealand
- Tamil Nadu electricity Board
- Vedanta Resources Plc - India
- Power Finance Corporation Ltd., India
- Coal and Oil Company - UAE
- Sojitz Corporation - Japan
- Madhucon Powers Ltd - India
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