How does a general taxpayer deduct input tax when purchasing domestic passenger transportation services?

2026-02-25 10:38:46

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Q: How can general taxpayers deduct input VAT when purchasing domestic passenger transportation services?

A: According to the “Announcement of the Ministry of Finance and the State Taxation Administration on Matters Concerning the Deduction of Input VAT and Other Related Issues” (Cai Shui [2026] No. 13), the following rules apply:

Regarding the deduction of input VAT

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(2) For general taxpayers purchasing domestic passenger transportation services, in addition to obtaining a special VAT invoice, the deductible input VAT can be determined according to the following provisions:

For electronic invoices (railway electronic tickets) and electronic invoices (airline electronic boarding passes), the VAT amount listed or included on the invoice;
For tickets that specify passenger identity information, such as road and waterway transportation, the input VAT can be calculated using the following formula:

Deductible input VAT for other passenger transportation (road, waterway, etc.) = Ticket face value ÷ (1 + 3%) × 3%

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This announcement takes effect from January 1, 2026. If there are any inconsistencies with previous regulations, this announcement shall prevail.

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