BEIJING, April 30 -- China's is to replace turnover tax with value-added tax (VAT) in the telecom sector, following similar changes in transport and some service sectors in 2012.

The new rules become effective on June 1, the Ministry of Finance and the State Administration of Taxation announced on Wednesday.

Basic telecom services such as voice calls and rental or sales of bandwidth will be subject to 11 percent VAT while value-added services such as messaging, data services and Internet access will be subject to a 6 percent rate. Overseas clients will be exempt.

Turnover tax refers to a tax on the gross revenue of a business, while a VAT refers to a tax levied on the difference between a commodity's price before taxes and its cost of production.