On 2 November 2016, the State Administration of Taxation (SAT) issued a Public Notice on Matters relating to Financial Accounting Statements that are submitted together with the CIT Returns Filed by the Thousand Groups and Enterprises within These Groups, (SAT Public Notice  No. 67, hereinafter referred to as "PN67") under the "Thousand Groups Project" to stipulate that key large business groups ("Thousand Groups") selected by the SAT and enterprises within these groups shall submit their financial accounting statements during the CIT filing. The policy interpretation of PN67 released by the SAT at the same time provided a detailed explanation of the background, scope and requirements as well as the submission deadline.
It is the first time that the requirements for tax collection and administration on "Thousand Groups" is raised in a public document like PN67, which reflected the expansion of targets on the tax administration of large business groups and the importance of taxpayers' data. This a crucial stage in the process of implementing tax administration on large business groups by the Chinese tax authorities. PN67 shall take effect from 1 December 2016. After the data submission of "Thousand Groups Project" becomes standardized and normalized, it will be the next move of the Chinese tax authorities to strengthen the collection, analysis and utilization of data, which would greatly impact the relevant taxpayers.
In this issue of China Tax/Business News Flash, we have briefly looked back at the course of tax administration on large business groups, summarized the specific regulations of the PN67, looked forward to the development of tax administration on large business groups and share our observations and views on the opportunities and challenges for taxpayers.