The COVID-19 pandemic has significantly impacted the normal operation of multinational enterprises to different extents. One of the notably impacts is the restriction on travelling. Many cross-border workers are unable to physically perform their duties in their country of employment.

In the wake of these international issues, the Organization for Economic Co-operation and Development (“OECD”) had issued an analysis called “OECD Secretariat Analysis of Tax Treaties and the Impact of the COVID-19 Crisis” (referred as the “OECD Analysis” in this newsletter) on 3 April 2020. Mazars analyzed the OECD Analysis on its China Tax Newsletter in April 2020.

China’s position on this issue was uncertain even though it is expected that it will follow the OECD Analysis.  On 14 August 2020, the International Taxation Department of the State Taxation Administration (“STA”) released on its official website of “Frequently Asked Questions” (“FAQ”) with respect to the Application of International Tax Treaties due to COVID-19.

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