(NDC No. (2000)41)
All provincial, autonomous region and municipal People’s Governments, all State Council ministries and commissions, all directly subordinate organs:
Since the reform and opening up, especially since the Fourteenth Party Congress, the Central Committee and the State Council have brought on stage a number of cultural economic policies, which have developed a vigorous function in reforming and propagating the cultural management system and completing and propagating the internal business system of cultural organs, stimulating spiritual culture product production and propagating the establishment of cultural facilities, improving and propagating the material conditions of cultural organs, and moved forward the propagating of healthy cultural sector development.
In order to earnestly implement the spirit concerning “continuously implementing relevant policies to support cultural sector development, increase input in important news media and public interest culture sectors” in the “Central Committee Opinions Concerning Formulating the Tenth National Economy and Social Development Five-Year Plan”, deepen propagating of cultural management system reform, move forward propaganda and cultural sector development, after the conclusion of the “Ninth Five”, it is necessary to continuously implement the “Some State Council Regulations Concerning Further Completion of Cultural Economic Policies” (NDC No. (1996)37), and relevant documents and enlarge fiscal support systems, all cultural economic policies currently in effect will be adjusted and perfected. The relevant issues are hereby notified as follows:
I, Continuously collect culture management construction fees.
(1) All sorts of commercial entertainment venues such as music halls, dance halls, karaoke song and dance halls, music teahouses and golf, billiards, pool venues, etc. will pay 3% of business income for cultural sector construction fees.
Media work units such as radio stations, television stations and newspapers and periodicals, etc., as well as outdoor advertising business work units, will pay 3% of business income for cultural sector construction fees.
(2) Cultural sector construction fees will be collected together with the collection of entertainment business and advertising business tax by the local tax organ. Cultural construction fees paid by central and State organs subordinate work units will be completely handed over to the central treasury after collection by the local tax organs. Cultural construction fees locally paid, will be completely handed over to the provincial-level treasury.
(3) Cultural sector construction fees entered into financial budget management, will be used for cultural sector instruction respectively by special central and provincial-level funds. Cultural sector construction fees management and use, will be continuously implemented according to the “Notice Concerning Promulgation of the ‘Cultural Sector Construction Fee Use Management Rules'” of the Ministry of Financial administration and the Central Committee Propaganda Department (MoF No. (1997)243).
II, V.A.T. for the following publications will continue to implement the first tax and then pay back method. Unlawful publications and publishers repeatedly displaying unlawful publications may not enjoy the policy of this Paragraph.
(1) China Communist Party and all democratic parties’ official newspapers and official periodicals.
(2) All levels’ People’s Government official newspapers and official periodicals.
(3) All levels’ People Congress, People’s Political Consultative Conference, labour unions, Communist Youth League and Women’s League official newspapers and periodicals.
(4) Xinhua News Agency’s official newspapers and official periodicals.
(5) Military entities’ official newspapers and periodicals.
(6) Higher, middle and lower education original student handbooks and newspapers and periodicals specially published and distributed for children.
(7) Science and technology books and science and technology periodicals.
III, V.A.T. over sales of county (including county-level city) and lower than county-level Xinhua bookstores and rural cooperative sellers in the entire country, will continue to implement the first tax and then pay back method.
IV, The following five economic policies for development of the cultural sector will be continuously implemented.
(1) Film copy sale income of film studios approved for establishment by the State Council is exempt from V.A.T; film distribution work units income obtained from distribution to projection work units is exempt from business tax.
(2) From film projection income, 5% is drawn to establish a “Special State Film Sector Development Fund”, used for film sector macroeconomic regulation.
(3) From television advertising net income, 3% is drawn to establish a “Special Exceptional Film Goods Fund”, for supporting shooting of exceptional film goods.
(4) From film import income, a part is drawn to produce and dub films.
(5) Specially important film creation and production, may apply with financial administration for subsidies.
V, Continuously increasing financial administration input in propagating the cultural sector.
(1) Central and provincial-level financial administration will continuously, according to the realistic collection numbers appropriation budget of income tax handed over by propaganda and culture enterprises, establish a special propaganda and culture development fund; central and provincial-level financial administration must continuously in the arranging of a part of special funds in making up the budget, enter special propaganda and culture development funds.
(2) Suitable increase of “Ten Thousand Miles Border Culture Long Corridor” subsidy finds. In arranging the ethnicity operating expenses and border construction fees, a certain amount supports cultural sector development in remote border regions and ethnic minority regions. The relevant localities’ People’s Governments shall also progressively increase input in remote border regions and ethnic minority regions’ cultural sectors.
VI, Establishing and perfecting special funding systems. In order to stimulate propaganda and culture sector development, strengthen regulation and control capacity, guarantee major requirements, standardize funding management, the centre and provincial level must establish and perfect relevant special funding systems.
The sources of special funding are funds budgeted by the financial administration and non-budgeted funds such as fees approved according to relevant State regulations. Financial administration work units must do well the budget arrangements for special funds, relevant entities must prohibit all levying of non-budgeted funds according to regulations. It is necessary to further perfect special funds such as the “propaganda and cultural development special fund”, “excellent drama (programme) creation and performance special fund”, “State film sector development fund”, “Excellent film product special fund” and the “publication development special fund”, etc.
Special funds are financial administration funds, and it is necessary to perfect the system and strengthen management according to relevant financial administration laws and regulations, guarantee the special use of special funds and receive supervision and examination by financial administration and accounting entities.
VII, Continuously encouraging contributions to the propaganda and cultural sector. Social forces through State approval establishing non-commercial public benefit groups or state organs contributing to the following propaganda and cultural sectors, are brought into the public interest contributions scope, after examination and verification by tax organs, when tax payers pay enterprise income tax, the part within 10% of the yearly taxable income, may be deducted in the calculation of taxable income; when tax payers pay individual income tax, the amount of contribution not exceeding a part of 30% of the total taxable income reported by the taxpayer, may be deducted from his taxable income value.
(1) Contributions to State key symphony orchestras, ballet troupes, opera troupes, Beijing opera troupes and other ethnic art performance troupes.
(2) Contributions to public interest libraries, museums, scientific and technological research establishments, art galleries, revolutionary history memorial halls.
(3) Contributions to key cultural object protection work units.
(4) Contributions to matters such as public benefit activities, programmes and cultural facilities, etc. of administrative cultural management entities’ subordinated non-commercial cultural centres or masses art museums.
VIII, Grasping implementation, strengthening management. All levels financial administration entities must earnestly implement all cultural economic policies. Propaganda and culture controlling entities must fully develop cultural economic policies’ macroeconomic regulation functions. Propaganda and culture organs must deepen internal reform, transform business systems, complete financial systems, strengthen financial management, accepted contribution funds must be specially used for developing the cultural sector, and may not be infringed upon, diverted or even privately divided, and may also not be chaotically apportioned, and indiscriminately collected, etc. To all sorts of unlawful or irregular activities, liability must be investigated, and strictly dealt with.
18 December 2000