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In this issue of China Briefing, we take a detailed look at China's seemingly complex value-added tax system. China's VAT regime contributes a significant portion of the country's annual tax revenues and is an important part of the government's tax system. At the start of 2009, the central government rolled out a national VAT reform policy that had previously been piloted in several select regions of the country. The new reform policy moved China's VAT system from production-based to consumption-based and changed many of the tax benefits companies in China enjoy. Our feature article this month explains China's VAT system, takes a look at the rates and calculations for general taxpayers and small income tax payers, examines export tax rebates, and reviews the new VAT reform measures.