The Ministry of Finance and the State Administration of Taxation jointly issued the “Notice on Transferring and Enhancing the Tax Policy for the Administration of State-owned Equity and Cash Income Operations of Social Security Funds”

The Zhitong Finance App learned that on September 2, the Ministry of Finance and the State Administration of Taxation jointly issued the “Notice on Transferring and Enriching the Tax Policy for the Operation and Administration of State-owned Equity and Cash Income of Social Security Funds”, which mentions that all interest earned by the undertaker in the process of using transferred state-owned equity and cash proceeds from loan services and financial product transfer income are exempt from VAT. Income obtained from the transfer of transferred state-owned shares and cash income investments is income not subject to corporate income tax. State-owned shares of listed companies transferred by the undertaker are collected first, and the securities transaction stamp duty payable when using cash proceeds to trade securities is levied first and then returned.

The original text is as follows:

Notice on Transferring and Enhancing Tax Policies for the Operation and Administration of State-owned Equity and Cash Income of Social Security Funds

Finance and Taxation [2025] No. 26

Finance departments (bureaus) of each province, autonomous region, municipality directly under the Central Government, and planned separate municipalities; Xinjiang Production and Construction Corps Finance Bureau; State Administration of Taxation, taxation bureaus of each province, autonomous region, municipality directly under the Central Government, and planned separate municipalities:

In order to support the transfer and enhancement of the operation and management of state-owned equity and cash income of social security funds, the relevant tax policies are now announced as follows:

1. The undertaker is exempt from value-added tax on all interest earned from loan services and income from financial product transfers in the process of investing using transferred state-owned shares and cash proceeds.

2. Income obtained from the transfer of transferred state-owned shares and cash income investments shall be used as income not subject to corporate income tax.

3. State-owned shares of unlisted companies transferred by the undertaker are exempt from the stamp duty payable by the undertaker.

4. State-owned shares of listed companies transferred by the undertaker and the securities transaction stamp duty payable using cash proceeds to trade securities shall be levied first and then returned.

5. The undertaker mentioned in this notice refers to the entity responsible for the operation and management of state-owned equity and cash income as stipulated in the “Notice of the State Council on Issuing the Implementation Plan for Transferring Part of State-owned Capital to Enrich the Social Security Fund” (Guofa (2017) No. 49), including: the National Social Security Fund Council and wholly state-owned companies established by the people's governments of each province, autonomous region, and municipality directly under the Central Government responsible for centrally holding, managing, and transferring state-owned shares, or companies with the function of investing and operating state-owned capital to carry out special account management for the transfer of state-owned shares.

6. This notice will take effect on April 1, 2024. Taxes paid before the notice is issued may be refunded if they comply with the provisions of this notice.

Ministry of Finance and General Administration of Taxation

August 27, 2025

This article was selected from “Department of Taxation and Administration of the Ministry of Finance”, Zhitong Finance Editor: Xu Wenqiang.