1.

In their letter to the Hong Kong Inland Revenue Department (IRD) dated 9 May 2008, the State Administration of Taxation (SAT) confirmed the acceptance of the relevant experience obtained by Hong Kong residents in Hong Kong for purposes of practising registration as Certified Tax Agent (CTA) in the Mainland.

2.

In June 2006, the Taxation Institute of Hong Kong (TIHK) entered into an agreement with the CTA Management Centre of the SAT ("國家稅務總局註冊稅務師管理中心"), State Personnel Examination Centre ("國家人事部考試中心") and the Hong Kong Examination Authority. It was agreed that with effect from 2007 Hong Kong residents could join the CTA Examination ("中國註冊稅務師考試") through the TIHK and attempt the examination in Hong Kong. A successful Hong Kong candidate would receive the CTA Certificate ("中華人民共和國註冊稅務師執業資格証書").

3.

According to the SAT Order No. 14 issued on 31 December 2005, a person with the CTA Certificate has to practise in a CTA firm in the Mainland for 2 years before he can apply for practising registration.

4.

In order to encourage more certificate holders to join the CTA profession, with effect from March 2007 SAT allowed CTA practising in an accounting firm in the Mainland to join a CTA firm after formal resignation from the accounting firm. Besides, a person with the CTA Certificate can apply for practising registration if he had worked in an accounting firm in the Mainland of China and provided professional taxation consultancy services for 2 years, with no record of malpractices.

5.

The IRD held discussion with the SAT in the beginning of this year to lobby for the acceptance of the relevant experience obtained by Hong Kong residents in Hong Kong for purposes of practising registration as CTA in the Mainland. After due consideration, the SAT confirmed in May 2008 that the similar guidelines for CTA working in an accounting firm in the Mainland as stated in the Guoshuihan [2007] No. 343 can be applied to a Hong Kong resident with the CTA Certificate. In other words, the latter can apply for practising registration as CTA in the Mainland if he had worked in a qualified accounting firm in Hong Kong or in the Mainland and provided professional taxation consultancy services for 2 years, with no record of malpractices.