On March 18, 2009, the State Administration of Taxation (SAT) issued the Circular on Tax Issues Concerning Bonded Logistics Centers and Export Processing Zones After Their Function Expansion. According to the Circular, relevant government authorities have approved the establishment of 23 bonded logistics centers in China. These centers may enjoy favorable taxation and foreign exchange policies, and offer comprehensive logistics services in international transport, warehousing, distribution, procurement, trade and export processing businesses.
The Circular aims to promote the transformation and advancement of trade processing that accompanies the establishment of bonded logistics centers, and encourage export processing zones to expand their bonded logistics functions to undertake research and development, examination and maintenance businesses.
According to the Circular, when domestic goods enter into bonded logistics centers, the goods are deemed exported and export rebate policies apply. When foreign goods in bonded logistics centers enter into China, the goods are deemed imported, and must clear import declaration procedures. Import VAT and consumption taxes may apply. The Circular refers to the Administration Measures for the Taxation of Type-B Bonded Logistics Centers issued by SAT in November 2004 for specific rules that govern these bonded logistics centers.
The 23 bonded logistics centers are located in Tianjin Economic and Technological Development Zone, Shanghai Northwest Logistics Park, Dongguan, Zhongshan, Guangzhou Airport, Jiangyin, Taicang, Hangzhou, Qingdao, Rizhao, Xiamen, Yingkou Port, Xi’an, Chengdu, Changsha, Nanchang, Shanxi, Wuhan, Nanning, Shenyang, Ningbo, Lianyungang, and Shenzhen Airport.