Company: STAK
Filing Date: 2025-11-05
Form Type: 20-F
Source: 0001493152-25-020818
Chunk: 73

Company: STAK Inc.
Filing Date: 2025-11-05
Form: 20-F
Item: Item 4
Chunk 73
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 preferential tax treatments, the PRC tax authorities will have the discretion to adjust the preferential tax rate enjoyed by the relevant offshore entity.
 
PRC Value-Added Tax
 
Pursuant to the Interim Regulations on Value-Added Tax of the People’s Republic of China, which was promulgated by the State Council on December 13, 1993 and amended on November 10, 2008, February 6, 2016 and November 19, 2017, and the Implementation Rules for the Interim Regulations on Value-Added Tax of the People’s Republic of China, which was promulgated by the MOF on December 25, 1993 and amended on December 15, 2008 and October 28, 2011, entities or individuals engaging in sale of goods, provision of processing services, repairs and replacement services or import of goods within the territory of the PRC shall pay value-added tax (the “VAT”). Unless provided otherwise, the rate of VAT is 17% on sales and 6% on the services. The Value-Added Tax Law of the PRC was promulgated on December 25, 2024 and will come into effect on January 1, 2026.
 

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On March 23, 2016, the Ministry of Finance (the “MOF”) and SAT, jointly issued the Circular on the Pilot Program for Overall Implementation of the Collection of Value Added Tax Instead of Business Tax, (the “Circular 36”), which took effect on May 1, 2016. Pursuant to the Circular 36, all companies operating in construction, real estate, finance, modern service or other sectors obligated to pay business tax are required to pay VAT, in lieu of business tax. The VAT rate is 6%, except that a rate of 11% applies to real estate sale, land use right transferring and providing service of transportation, postal sector, basic telecommunications, construction, real estate lease, and a rate of 17% applies to providing lease service of tangible property, and a rate of zero for specific cross-bond activities.
 
On April 4, 2018, the MOF and the SAT jointly promulgated the Circular of the SAT on Adjustment of Value-Added Tax Rates (the “Circular 32”), according to which, (i) for VAT taxable sales or importation of goods originally subject to VAT rates of 17% and 11% respectively, applicable tax rates