Article 1 The Detailed Rules are formulated in accordance with the Interim Regulations of the People's Republic of China on Business Tax (hereinafter referred to as the Regulations).

Article 2 Services as mentioned in Article 1 of the Regulations refer to services within the scope of taxable items in the transportation, construction, finance and insurance, posts and telecommunications, culture and sports, entertainment and service industries (hereinafter referred to as taxable services).

Processing, repair and replacement are not services as stipulated in the Regulations (hereinafter referred to as non-taxable services).

Article 3 The provision of taxable services, transfer of intangible assets or the sale of real estates as mentioned in Article 1 of the Regulations refers to activities of providing taxable services, transferring intangible assets or ownership of immovable properties with compensation (hereinafter referred to as the taxable activities). However, taxable services provided by the staff employed by units or individual operators to their own units or employers shall not be included therein.

The term "with compensation" in the preceding paragraph includes receipt of currency, goods and other economic benefits.

Article 4 The provision of taxable services, transfer of intangible assets or sale of real estates within the territory of the People's Republic of China (hereinafter referred to as within the territory) as mentioned in Article 1 of the Regulations means that:

1. The units or individuals of provision or acceptance of taxable services in the Regulations within the territory;

2. The acceptance units or individuals of intangible assets transferred to (excluding land use right) within the territory;

3. Land whose use right is transferred or rented within the territory; and

4. Real assets being sold or rented within the territory.

Article 5 Taxable acts of the taxpayers shall occur in any of the following situations:

1. Units or individuals donate real assets or land use right to other units or individuals without compensation;

2. For units or individuals that sell their newly self-constructed buildings (hereinafter referred to as self-construction), their self-construction activities shall be regarded as taxable services; and

3. Other acts regulated by the Ministry of Finance and the State Administration of Taxation.

Article 6 A sale activity that involves both taxable services and goods is deemed to be a mixed sales activity. Mixed sales activities of enterprises, enterprise units or individual business operators engaged in production, wholesale or retail of goods shall be classified as sales of goods, and Business Tax shall not be levied on the sales; mixed sales activities of other units and individuals shall be classified as provision of taxable services, and Business Tax shall be levied on the sales.

Goods as mentioned in Paragraph 1 refer to tangible moveable goods, including power, heating and gas.

Enterprises, enterprise units or individual business operators engaged in the production, wholesale and retail of goods as mentioned in Paragraph 1 include enterprises, enterprise units and individual business operators principally engaged in the production, wholesale and retail of goods, and concurrently engaged in taxable services.

Article 7 Turnover of taxable services and sales amount of goods shall be separately computed, and Business Tax shall be levied on turnover of taxable services and Business Tax shall not be levied on sales amount of goods; for the taxpayers that have not been separately computed, the competent tax authorities shall assess the turnover of their taxable services for the following mixed sales activities by the taxpayers:

1. Sale of self manufactured goods while providing taxable services of construction industry; and

2. Other institutions regulated by the Ministry of Finance and the State Administration of Taxation.