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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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Friday, 10 October 14
U.S. PRODUCED 83.2 MMST OF COAL IN SEPTEMBER, SAYS EIA
COALspot.com – United States the world's one of largest coal producers, produced approximately 18.6 million short tons (mmst) of coal in ...
Thursday, 09 October 14
CAPESIZE MARKET HAS CONTINUED TO SHOW WEAKNESS - FEARNLEYS
Handy
We mentioned last week that after several weeks of rate increase for the Supras, the bigger Panamaxes started to snap up better paying Supr ...
Thursday, 09 October 14
SHIPPING REMAINS CHALLENGED AS GLOBAL GROWTH DISAPPOINTS - BIMCO
The global shipping industry finds no grace from much stronger economic activity going forward, as the global recovery remains fragile and uneven. ...
Wednesday, 08 October 14
CAPES RATE FOR THE W. AUSTRALIA TO CHINA VOYAGE MOVED TO BELOW $8/MT - INTERMODAL
The Dry Bulk market remained under pressure last week, with rates for Capes remaining on the red while those for Panamaxes managed to outperform th ...
Wednesday, 08 October 14
OIL COULD FALL TO USD80 BEFORE SHALE SUPPLY RESPONSE - FITCH
COALspot.com: Brent oil could fall as low as USD80 a barrel before triggering a self-correcting supply response with shale-oil drillers cutting inv ...
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- Pendopo Energi Batubara - Indonesia
- Bukit Makmur.PT - Indonesia
- Singapore Mercantile Exchange
- Heidelberg Cement - Germany
- Therma Luzon, Inc, Philippines
- Minerals Council of Australia
- Madhucon Powers Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Kumho Petrochemical, South Korea
- Tata Chemicals Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Krishnapatnam Port Company Ltd. - India
- Maheswari Brothers Coal Limited - India
- Trasteel International SA, Italy
- Miang Besar Coal Terminal - Indonesia
- South Luzon Thermal Energy Corporation
- Parliament of New Zealand
- Global Business Power Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Ceylon Electricity Board - Sri Lanka
- Savvy Resources Ltd - HongKong
- IEA Clean Coal Centre - UK
- Videocon Industries ltd - India
- MS Steel International - UAE
- VISA Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Indogreen Group - Indonesia
- Formosa Plastics Group - Taiwan
- Deloitte Consulting - India
- GN Power Mariveles Coal Plant, Philippines
- Siam City Cement PLC, Thailand
- Barasentosa Lestari - Indonesia
- Bharathi Cement Corporation - India
- Maharashtra Electricity Regulatory Commission - India
- Jaiprakash Power Ventures ltd
- Gujarat Mineral Development Corp Ltd - India
- Altura Mining Limited, Indonesia
- IHS Mccloskey Coal Group - USA
- Standard Chartered Bank - UAE
- TNB Fuel Sdn Bhd - Malaysia
- Coalindo Energy - Indonesia
- Rio Tinto Coal - Australia
- Vizag Seaport Private Limited - India
- Jindal Steel & Power Ltd - India
- Eastern Coal Council - USA
- Kalimantan Lumbung Energi - Indonesia
- Karaikal Port Pvt Ltd - India
- Borneo Indobara - Indonesia
- SN Aboitiz Power Inc, Philippines
- Coastal Gujarat Power Limited - India
- Metalloyd Limited - United Kingdom
- Bulk Trading Sa - Switzerland
- Larsen & Toubro Limited - India
- Africa Commodities Group - South Africa
- Tamil Nadu electricity Board
- Energy Link Ltd, New Zealand
- Thiess Contractors Indonesia
- Intertek Mineral Services - Indonesia
- Straits Asia Resources Limited - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Uttam Galva Steels Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Oldendorff Carriers - Singapore
- The State Trading Corporation of India Ltd
- Bangladesh Power Developement Board
- Marubeni Corporation - India
- Sindya Power Generating Company Private Ltd
- McConnell Dowell - Australia
- LBH Netherlands Bv - Netherlands
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kepco SPC Power Corporation, Philippines
- Anglo American - United Kingdom
- Price Waterhouse Coopers - Russia
- Renaissance Capital - South Africa
- Electricity Authority, New Zealand
- ASAPP Information Group - India
- Iligan Light & Power Inc, Philippines
- Central Electricity Authority - India
- Wilmar Investment Holdings
- Gujarat Sidhee Cement - India
- Neyveli Lignite Corporation Ltd, - India
- Port Waratah Coal Services - Australia
- Antam Resourcindo - Indonesia
- Indika Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Semirara Mining Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Aboitiz Power Corporation - Philippines
- Medco Energi Mining Internasional
- Kaltim Prima Coal - Indonesia
- TeaM Sual Corporation - Philippines
- Globalindo Alam Lestari - Indonesia
- Bukit Baiduri Energy - Indonesia
- Indonesian Coal Mining Association
- Manunggal Multi Energi - Indonesia
- Sojitz Corporation - Japan
- Samtan Co., Ltd - South Korea
- Global Coal Blending Company Limited - Australia
- Sarangani Energy Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Commonwealth Bank - Australia
- Asmin Koalindo Tuhup - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Grasim Industreis Ltd - India
- Bhushan Steel Limited - India
- Ind-Barath Power Infra Limited - India
- Bhoruka Overseas - Indonesia
- Coal and Oil Company - UAE
- European Bulk Services B.V. - Netherlands
- SMC Global Power, Philippines
- Kapuas Tunggal Persada - Indonesia
- Ministry of Mines - Canada
- Ambuja Cements Ltd - India
- Mjunction Services Limited - India
- Essar Steel Hazira Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Mintek Dendrill Indonesia
- PNOC Exploration Corporation - Philippines
- Toyota Tsusho Corporation, Japan
- Kideco Jaya Agung - Indonesia
- Indian Oil Corporation Limited
- Australian Commodity Traders Exchange
- Karbindo Abesyapradhi - Indoneisa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sakthi Sugars Limited - India
- Chettinad Cement Corporation Ltd - India
- Interocean Group of Companies - India
- Star Paper Mills Limited - India
- Xindia Steels Limited - India
- Directorate Of Revenue Intelligence - India
- Orica Mining Services - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Sinarmas Energy and Mining - Indonesia
- Makarim & Taira - Indonesia
- Latin American Coal - Colombia
- Siam City Cement - Thailand
- PetroVietnam Power Coal Import and Supply Company
- Semirara Mining and Power Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Lanco Infratech Ltd - India
- ICICI Bank Limited - India
- PTC India Limited - India
- Holcim Trading Pte Ltd - Singapore
- Ministry of Transport, Egypt
- Meralco Power Generation, Philippines
- CNBM International Corporation - China
- Independent Power Producers Association of India
- Bukit Asam (Persero) Tbk - Indonesia
- Mercator Lines Limited - India
- Edison Trading Spa - Italy
- Agrawal Coal Company - India
- Cement Manufacturers Association - India
- Riau Bara Harum - Indonesia
- PowerSource Philippines DevCo
- San Jose City I Power Corp, Philippines
- Central Java Power - Indonesia
- Orica Australia Pty. Ltd.
- Georgia Ports Authority, United States
- Cigading International Bulk Terminal - Indonesia
- SMG Consultants - Indonesia
- Parry Sugars Refinery, India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Australian Coal Association
- Ministry of Finance - Indonesia
- Sree Jayajothi Cements Limited - India
- Binh Thuan Hamico - Vietnam
- Chamber of Mines of South Africa
- OPG Power Generation Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Baramulti Group, Indonesia
- Thai Mozambique Logistica
- Goldman Sachs - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Sical Logistics Limited - India
- Merrill Lynch Commodities Europe
- Malabar Cements Ltd - India
- The Treasury - Australian Government
- Planning Commission, India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vedanta Resources Plc - India
- Dalmia Cement Bharat India
- Power Finance Corporation Ltd., India
- Meenaskhi Energy Private Limited - India
- Energy Development Corp, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Eastern Energy - Thailand
- India Bulls Power Limited - India
- Aditya Birla Group - India
- Kobexindo Tractors - Indoneisa
- GMR Energy Limited - India
- Global Green Power PLC Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- White Energy Company Limited
- Economic Council, Georgia
- Billiton Holdings Pty Ltd - Australia
- Carbofer General Trading SA - India
- London Commodity Brokers - England
- Wood Mackenzie - Singapore
- Petron Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Romanian Commodities Exchange
- Mercuria Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- New Zealand Coal & Carbon
- Salva Resources Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Bhatia International Limited - India
- GVK Power & Infra Limited - India
- The University of Queensland
- Leighton Contractors Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Indian Energy Exchange, India
- Simpson Spence & Young - Indonesia
- International Coal Ventures Pvt Ltd - India
- Posco Energy - South Korea
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