Core Viewpoint - The article discusses the tax deduction policies for advertising and business promotion expenses for different industries, highlighting specific limits and conditions for deductions based on sales revenue [10][16]. Group 1: General Deduction Rules - For general industries, advertising and business promotion expenses can be deducted up to 15% of the annual sales revenue, with any excess allowed to be carried forward to future tax years [10][12]. - For cosmetic manufacturing or sales, pharmaceutical manufacturing, and beverage manufacturing (excluding alcoholic beverages), the deduction limit is set at 30% of the annual sales revenue, with excess amounts also eligible for carryforward [16]. Group 2: Special Cases - Tobacco companies are prohibited from deducting any advertising and business promotion expenses when calculating taxable income [16]. - In cases where related enterprises have signed a cost-sharing agreement for advertising and business promotion expenses, the expenses incurred by one party can be deducted by either party, provided they fall within the allowable limits based on their sales revenue [16]. Group 3: Calculation Basis - The calculation basis for the annual deduction limit for advertising and business promotion expenses is the company's annual sales revenue, which includes deemed sales revenue as specified in the relevant tax regulations [10][11].

Core Viewpoint - The recent announcement by the Ministry of Finance and the State Taxation Administration allows cosmetic, pharmaceutical, and beverage manufacturing companies to deduct advertising and promotional expenses up to 30% of their annual sales revenue, effective from January 1, 2026, to December 31, 2027, providing a significant financial relief for these industries [3][4]. Group 1: Policy Details - The new policy extends the existing tax deduction for advertising and promotional expenses for the cosmetic, pharmaceutical, and beverage manufacturing sectors, which previously had a deduction limit of 30% compared to the 15% limit for other industries [4]. - This policy aims to alleviate cash flow pressures for these industries, encouraging them to invest more in marketing and brand building [4]. - The announcement reiterates that tobacco advertising expenses are not deductible, aligning with health regulations [4]. Group 2: Historical Context - The original policy allowing a 30% deduction for these industries was first introduced in 2009 and has been extended multiple times, with the last extension set to expire at the end of 2025 [4]. - The current announcement extends this favorable tax treatment until the end of 2027, providing a "reassurance" for companies in these sectors [4]. Group 3: Related Provisions - The announcement clarifies that related companies can share advertising and promotional expense deductions through a cost-sharing agreement, allowing for flexibility in tax deductions [5].

Core Viewpoint - The announcement from the Ministry of Finance and the State Taxation Administration allows companies in the cosmetics, pharmaceuticals, and beverage manufacturing sectors to deduct advertising and promotional expenses up to 30% of their annual sales revenue, effective from January 1, 2026, to December 31, 2027, which is an extension of an existing policy [2][3]. Group 1 - The new policy permits advertising and promotional expenses not exceeding 30% of annual sales revenue to be deductible, with any excess allowed to be carried forward to future tax years [2][3]. - This policy is particularly beneficial for the cosmetics, pharmaceuticals, and beverage industries, which typically incur higher advertising costs relative to their sales revenue [3]. - The previous deduction limit for other industries was 15%, highlighting the favorable treatment for the specified sectors [3]. Group 2 - The announcement reiterates that tobacco advertising expenses are not deductible, in line with health regulations prohibiting tobacco advertising [3]. - It also clarifies that related companies can share advertising and promotional expense deductions under specific agreements, allowing for flexibility in tax calculations [4].

Core Viewpoint - The announcement by the Ministry of Finance and the State Taxation Administration outlines new tax deduction rules for advertising and business promotion expenses for specific industries, effective from January 1, 2026, to December 31, 2027 [1] Group 1: Tax Deduction Rules - For cosmetics manufacturing or sales, pharmaceutical manufacturing, and beverage manufacturing (excluding alcoholic beverages), advertising and business promotion expenses are deductible up to 30% of the annual sales revenue; any excess can be carried forward to future tax years [1] - Related enterprises that sign a cost-sharing agreement can deduct advertising and business promotion expenses within the allowable limit in either party's accounts, with specific provisions for how these expenses are accounted for [1] - Tobacco companies are prohibited from deducting any advertising and business promotion expenses when calculating taxable income [1] Group 2: Implementation Period - The new rules will be in effect from January 1, 2026, to December 31, 2027, and will replace the previous announcement (Announcement No. 43 of 2020) starting January 1, 2026 [1]

Group 1 - The core viewpoint of the article discusses the tax deductibility of advertising and business promotion expenses for enterprises, highlighting specific regulations and limits set by the Ministry of Finance and the State Taxation Administration [1][2][4] Group 2 - Enterprises can deduct advertising and business promotion expenses that do not exceed 15% of their annual sales revenue, with excess amounts allowed to be carried forward to future tax years [1] - From January 1, 2021, to December 31, 2025, certain industries, including cosmetics, pharmaceuticals, and non-alcoholic beverage manufacturing, can deduct up to 30% of their annual sales revenue for advertising and business promotion expenses [1] - The calculation base for deducting these expenses includes both sales revenue and deemed sales revenue, which encompasses various forms of income from goods and services [2] - Tobacco companies are explicitly prohibited from deducting any advertising and business promotion expenses from their taxable income [2] - Related enterprises that sign expense-sharing agreements can allocate advertising and business promotion expenses between them, allowing for tax deductions within the specified limits [4]