The State Council of China: Market Entity Can Do Anything That Is Not Forbidden by Laws

　　The document, Some Suggestions from the State Council of China on How to Promote Fair Competition and Maintain Normal Order in the Market, first systematically clarified the boundary between government and market. These Suggestions indicate that: “we shall give full play to the crucial role of market in resource allocation, lift the control over the power that should be freed and put it in place, lower the requirements for market access, and encourage employment and startups. Market entity can do anything that is not forbidden by laws; government authorities can’t do anything that is not allowed by laws.”

　　A Conference of the State Council of China Approved the Draft Amendment to the Law of CPA

　　The Law of CPA was scheduled into the legislation plan of the State Council of China in 2010. On April 1st, 2012, the Ministry of Finance issued the Draft Amendment to the Law of CPA of the People’s Republic of China to the public for suggestions. This amendment made significant changes in the clauses as to the qualifications of shareholders and partners of the accounting firm, the legal responsibilities of CPA, and others. The latest draft has not been published.

　　The Amendment of the Accounting Law Has Officially Started

　　A few days ago, the Ministry of Finance held a seminar with experts in this field including some CPPCC members to discuss the amendment of the Accounting Law, which has been amended respectively in 1993 and 1999 since it was put into effect in 1985.

　　Believing in Accounting ESNAI Business Climate Index Was Published

　　Esnai.com published the ESNAI Business Climate Index (Accounting Climate Index for short) for the first time. It shows that the Business Climate Index of the first half of 2014 is 103.23, in the interval of Slightly Booming; in the second half of 2014, the index is expected to rise to the interval of Relatively Booming (110.15), and the index of the whole year is expected to be 107.38.

　　The Content of 2014 Operational Guidance for CPA Was Issued

　　The new edition includes 271 assurance services, 149 consulting services, 17 services for startups in the accounting service bases, and the list of relevant laws and regulations.

　　Complementary Details for Fiscal and Tax Reforms Have Been Finished and Will Come Densely in the Second Half of the Year

　　According to the implementing regulations, replacing Business Tax with Value-added Tax in consumer services will be introduced in the second half of 2014, and in that time, the overmuch rates and levels of Business Tax will be optimized. The reform scheme of Consumption Tax has also been finished, and will be expanding in the second half of 2014, and then adjust the links of taxation in 2015. If the reform of Resource Tax goes well, it also will be introduced in the second half of 2014. The key points of future tax reforms are “Six Taxes and One Clear”. The first “Tax” refers to the Value-added Tax reform, namely replacing Business Tax with Value-added Tax; the second is Consumption Tax reform; the third is Resource Tax reform; the fourth is Environmental Tax; the fifth is the legislation of Real Estate Tax; the sixth is the reform of Individual Income Tax; and the “Clear” refers to “clear up tax preference”. In addition, the difficulties of fiscal and tax reforms lie in “Three Clear and Two Taxes”, namely clearing up tax preference, links with fiscal revenue and special payments; and the “Two Taxes” are Real Estate Tax and Individual Income Tax.