CMS Expert Guide to the law and regulation of Covid-19 tax relief

Country-by-country comparison

Value Added Tax

  • None
  • Manufacturers of key epidemic control supplies (“Key Supplies”) entitled to full refund of incremental uncredited input VAT
  • Revenues from transporting Key Supplies exempt from VAT
  • Revenues from providing public transportation services, lifestyle services and courier services delivering the life necessities are exempt from VAT
  • Small-scale VAT payer subject to a low VAT levy rate of 1% through May 2020
  • Deferral of filing deadlines

Corporate Income Tax

  • 2 months deferral of deadline for submission of Corporate tax return for 2 months (until 31 May 2020)
  • simpler procedure when asking for deferral of tax obligations, if the taxpayer is impacted by Coronavirus regulations (e.g. mandatory closure, quarantine etc.)
  • Industries severely affected by the epidemic allowed to carry forward the tax loss of 2020 for 8 years
  • Cost of donation of Key Supplies are fully deductible
  • Cost of new equipment acquired by enterprises producing Key Supplies to enhance the production capacity can be deducted in a one-off manner without depreciation over the use life
  • Deferral of filing deadlines

Social Security Contributions or Payroll Tax

  • 24 months deferral of April, May and July social security contribution payments for self-employed persons,
  • partial refund of salaries for employees, who cannot work due to Coronavirus restrictions (e.g. substantial lack of business, mandatory closure, medical quarantine etc.
  • deferral of social security contributions payment in now also possible
  • Cost of donation of cash or Key Supplies are fully deductible
  • Temporary working allowances and bonuses obtained by medical workers in epidemic prevention and control are exempt from Individual Income Tax (“IIT”)
  • Medicines, healthcare supplies and protection supplies offered by the employers to the individuals for epidemic prevention are exempt from IIT
  • Exemption or half-reduction of social security contributions for no more than 5 months
  • Deferral of filing or contribution deadlines

Other relief measures

  • 2 months deferral of deadline for submission of annual financial statements (until 31 May 2020)
  • all tax inspections and reviews are temporarily halted
  • judicial and administrative deadlines stop running until 30 July 2020
  • 12 months loan repayment deferral for businesses subject to mandatory closure during quarantine period
  • Foreign-donated supplies used to prevent and control the epidemic can be exempt from import taxes

Additional comments

  • Additional measures are planned to be introduced by 10 April 2020.
  • N/A