On August 3, 2016, MOF and SAT jointly issued Circular Cai Shui [2016] No. 86, on calculating deductible input VAT on tolls, i.e., fees collected according to laws and regulations for using roads, bridges and floodgates. 

A general VAT payer can deduct input VAT by applying the following formulas on toll receipts:  

- Deductible input VAT on freeway tolls = toll amount on the receipt/(1 + 3%) x 3%

- Deductible input VAT on tolls paid for arterial highway, secondary highway, bridge and floodgate = toll amount on the receipt/(1 + 5%) x 5%