On April 4, the tax rate adjustment document "Notice of the Ministry of Finance and the State Administration of Taxation on Adjusting Value-Added Tax Rates" (Caishui [2018] No. 32) was officially issued and will be implemented on May 1. The main tone of this tax rate adjustment is: lower tax rates and reduce burdens. Its main purpose is to reduce the burden on taxpayers and enhance the vitality of market entities. It is a good policy for the company, and it will certainly reduce our tax burden.

However, the implementation of the New Deal inevitably requires a transitional stage, and any related units are faced with different ways of handling the transitional period. How to make good use of the new regulations and avoid losses during the transition period, I think the first is to thoroughly understand the documents and find out the problem. The so-called "from May 1st" refers to the time when the tax liability occurs. All tax obligations that occur before May 1st will be taxed at the original 17% and 11% tax rates, and invoices will be issued at the original tax rate; on the contrary, if the tax liability occurs after May 1, the adjusted tax rate will apply. The new tax rates of 16% and 10% are paid, and invoices will be issued in accordance with the new tax rates. However, the corresponding strict billing requirements are difficult to achieve. Our company also faces the same problem in obtaining input tickets and issuance of sales tickets, which is basically a one-size-fits-all approach. That is, from May 1, 2018, sales invoices with the 17% and 11% tax rates will basically no longer be issued, and the purchased invoices have also been confirmed by the relevant departments that they cannot obtain the input invoices with the 17% and 11% tax rates.

The second is classified processing, compliance and tax avoidance. Invoices are divided into sales invoices and input invoices. The processing method of sales invoices is relatively simple. Basically, our marketing department has mastered the correct method of tax rate conversion: For sales businesses that signed a contract before May 1, the tax-included price conversion method is as follows: current price =Original price÷117%(111%)×116%(110%)

The obtaining of the input invoice is relatively more complicated. Due to the close connection between the supply and production areas of financial software, each inventory is pre-set with an adaptive tax rate, and the inventory business in the supply chain is uniformly set with a default tax rate. During this period, many problems have occurred. Business personnel have obtained 17% of the invoices that were previously issued that were not recorded in time and the invoices with new tax rates. Frequent adjustments to the tax rate settings of the receipt slips and documents will occur when the entry procedures are processed. This requires warehousing personnel and purchasing personnel to be careful and comb them carefully. For businesses that have gone through the warehousing procedures at the original tax rate but received invoices for the new tax rate before May 1st, the warehousing procedures must be adjusted one by one before invoice settlement. In the case that the full payment has been made but the input invoices are not issued in time at the original tax rate, it is necessary to strictly review whether the tax point is reduced to avoid causing losses to the company.

During the transition period, we will definitely face some problems. We hope that our relevant personnel will pay attention to it and actively solve them, so as to ensure the company's interests.