What are tax exemptions and reductions? What types of tax exemptions and reductions are there?

Tax reduction and exemption are measures of encouragement or care for certain taxpayers or taxable objects. Tax reduction means reducing part of the tax payable; tax exemption means exempting all the tax payable. Tax reduction and exemption provisions are measures taken to solve specific problems that cannot be solved when taxing at the tax rate stipulated in the tax system. They are a tax preference given to taxpayers in a certain period of time, and are also a concrete manifestation of the combination of uniformity and flexibility of taxation.

What types of tax relief are there?

1. Statutory exemptions

It is a classification of tax reduction and exemption. All tax reductions and exemptions stipulated by the basic laws of various taxes are called statutory tax reductions and exemptions. It reflects the basic principles and regulations of such tax reductions and exemptions and has long-term applicability. Statutory tax reductions and exemptions must clearly list the tax reduction and exemption items, scope and time of tax reduction and exemption in the basic laws and regulations. For example, the current "Provisional Regulations of the People's Republic of my country on Value Added Tax" clearly stipulates that agricultural producers are exempt from tax on self-produced agricultural products and contraceptive products sold by agricultural producers.

2. Temporary relief

Also known as "hardship relief", it refers to other temporary tax reductions and exemptions other than statutory reliefs and special reliefs, mainly to take care of some special temporary difficulties of taxpayers. Some tax reductions and exemptions are temporarily approved. It is usually regular tax reductions and exemptions or one-time tax reductions and exemptions. If a taxpayer encounters natural disasters such as wind, fire, flood or other special reasons and has difficulty paying taxes, he can be given regular or one-time tax reductions and exemptions after approval by the tax authorities.

3. Specific relief

It is a tax reduction and exemption stipulated according to the development and changes of social and economic conditions and the need to play the regulatory role of taxation. There are two main situations of specific exemptions and reductions: one is that after the basic tax law is determined, new supplementary provisions for tax reduction and reduction are made as the national political and economic conditions develop and change; the other is that in the basic tax law, it is impossible or inappropriate to list them one by one, and the tax reduction and reduction form of supplementary provisions is adopted. The above two types of specific exemptions and reductions are usually stipulated by the State Council or the Ministry of Finance, the State Administration of Taxation, and the General Administration of Customs as the national competent business departments. Specific exemptions and reductions can be divided into two types: unlimited and limited. Most specific exemptions and reductions are limited in time. When the tax reduction and reduction reaches the prescribed period, taxation should be resumed according to regulations.

This is the end of the introduction to tax reduction and exemption in this issue. If you want to get more information about tax reduction and exemption, please pay attention and we will continue to answer your questions~