Company: CAAS
Filing Date: 2025-07-25
Form Type: F-4/A
Source: 0001104659-25-070492
Chunk: 92

Company: China Automotive Systems, Inc.
Filing Date: 2025-07-25
Form: F-4/A
Chunk 92
---
-scale taxpayers is 3%. If a small-scale taxpayer’s total monthly sales
amount does not exceed RMB100 thousand and its quarterly sales volume does not exceed RMB300 thousand, the VAT will be exempted.

Dividend Withholding Tax

The EIT Law and its implementation rules provide
that since January 1, 2008, an income tax withholding rate of 10% will normally apply to dividends declared to non-PRC resident
investors that do not have an establishment or place of business in China, or that have such establishment or place of business but the
relevant income is not effectively connected with the establishment or place of business, to the extent such dividends are derived from
sources within China.

Pursuant to the Arrangement Between the Mainland
of China and the Hong Kong Special Administrative Region on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with
Respect to Taxes on Income and Capital, and other applicable PRC laws, if a Hong Kong resident enterprise is determined by the competent
PRC tax authority to have met the relevant conditions and requirements under this arrangement and other applicable laws, the 10% withholding
tax on the dividends the Hong Kong resident enterprise receives from a PRC resident enterprise may be reduced to 5%. However, based on
the Circular on Certain Issues with Respect to the Enforcement of Dividend Provisions in Tax Treaties issued on February 20, 2009,
if the relevant PRC tax authorities determine, in their discretion, that a company benefits from such reduced income tax rate due to a
structure or arrangement that is primarily tax-driven, such PRC tax authorities may adjust the preferential tax treatment. Pursuant
to the Circular on Several Questions regarding the “Beneficial Owner” in Tax Treaties, which was issued on February 3,
2018 by SAT and became effective on April 1, 2018, when determining the applicant’s status as the “beneficial owner”
regarding tax treatment in connection with dividends, interest, or royalties in the tax treaties, several factors, including, without
limitation, whether the applicant is obligated to pay more than 50% of his or her income in twelve months to residents in a third country
or region, whether the business operated by the applicant constitutes the actual business activities, and whether the counterparty country
or region to the tax treaties does not levy any tax or grant any tax exemption on relevant incomes or levy tax at an extremely low rate,
will be taken into