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The Local Tax Preferential Policies on Optimizing the Economic Development Environment (by December 31, 2012)

2017-11-21

Table of contents
  1. Policies to promote enterprise independent innovation and S & T progress (10 articles)
  1.1 High and new tech enterprise (5 articles)
  1.2 Technical achievement transfer (3 articles)
  1.3 Science and technology service (2 articles)
  2. Policies to promote the development of strategic emerging industries (10 articles)
  2.1 Energy-saving, environmental protection and new energy (7 articles)  
  2.2 Software, IC enterprises (3 articles)
  3. Policies to promote enterprises merger and acquisition (7 articles)
  4. Policies to promote the development financial capital market (6 articles)
  4.1 Banks and non-bank financial institutions (2 articles)
  4.2 Capital market (4 articles)
  5. Policies to promote the development of modern logistics (9 articles)
  5.1 Traffic & transportation (5 articles)  
  5.2 Warehousing and logistics (4 articles)
  6 Policies to promote the commercial service and intermediate service (5 articles)
  6.1 Financing lease (1 articles)
  6.2 Commercial service (4 articles)
  7 Policies to promote the development of travel, entertainment and exhibition businesses (4 articles)
  7.1 Travel business (2 articles)
  7.2 Entertainment business (1 article)
  7.3 Exhibition business (1 article)
  8 Policies to promote infrastructure development (7 articles)
  9 Policies to promote the development of agriculture, forestry, husbandry and fishery (8 articles)
  10 Policies to promote the development of culture, education and health (10 articles)
  10.1 Culture (6 articles)
  10.2 Education (2 articles)
  10.3 Health (2 articles)
  11 Policies to promote the development of small and micro-enterprises and individual industrial and commercial enterprises (11 articles)
  11.1 Reduction of burden (8 articles)
  11.2 Financing of enterprises (3 articles)
  12 Policies to promote employment and entrepreneurship (6 articles)
  12.1 Laid-off workers and unemployed persons (including graduates from colleges) (1 article)
  12.2 Demobilized army cadres, discharged soldiers and soldiers’ families (3 articles)
  12.3 Disabled persons (2 articles)
  13 Policies to promote construction of affordable housing (5 articles)
  13.1 Public rental apartments (1 article)
  13.2 Low-rent apartments and economically affordable apartments (1 article)
  13.3 Transformation of shantytowns (2 articles)
  13.4 House rental (1 article)
  14 Other preferential policies (2 articles)
  
  1. Policies to promote enterprise independent innovation and S & T progress
  1.1 High and new tech enterprise
  Article 1 The research and development expenses incurred for the development of new technology, new products and new techniques of an enterprise can be deducted when calculating its taxable amount. For the research and development expenses where the enterprise when no intangible asset has been formed and calculated into the current gains and losses, it shall deduce as per 50% of the research and development expenses; If intangible assets have been formed, they shall be amortized at 150% of the cost of the intangible assets.
  Enterprise Income Tax Law of the People’s Republic of China, Article 30 and Article 95
  Article 2 Where an enterprise is engaged in the research and development of a project prescribed in the High and New Tech Fields under the Key Support of the State and the Guidelines for Current Priorities for Development in Key Sectors of Hi-tech Industry (2007) as promulgated by the National Development and Reform Commission and other departments, the following expenses of the enterprise actually incurred in a tax year may be additionally calculated and deducted according to the provisions during the calculation of taxable income.
  (1) The expenses for the design of new products, the expenses for formulating new technical procedures, expenses for purchasing technical books and materials directly related to the research and development activities and the expenses for translation. (2) Expenses of materials, fuel and power directly consumed in the research and development activities. (3) The wages, salaries, bonuses, subsidies and allowances for the personnel who are directly engaged in the research and development activities. (4) Depreciation expenses or rentals for instruments and equipment used exclusively for research and development activities. (5) The amortized expenses of such intangible assets as software, patent rights and non-patented technologies used exclusively for research and development activities. (6) Expenses for the development and production of molds and technical equipment used exclusively for intermediate experiments and trial production of products. (7) Expenses for on-the-spot experiments for exploration and development technologies. and (8) Expenses for argumentation, assessment, and acceptance check of research and development results.
  Circular of the State Administration of Taxation on Issuing the Administrative Measures for the Pre-tax Deduction of Enterprise Research and Development Expenses (for Trial Implementation) ( No. 116 [2008] of the State Administration of Taxation)
  Article 3 Where it is surely necessary to accelerate the depreciation of any fixed asset of an enterprise because of technological progress or other reason, it may shorten the term of depreciation or adopt an approach to accelerate the depreciation. The minimum depreciation period shall be no less than 60% of the stipulated depreciation period; when adopting acceleration depreciation method, it can use depreciation method of double decline balance or the annual summation method.
  Enterprise Income Tax Law of the People’s Republic of China, Article 32; Notice on Handling of related Issues of Enterprise Income Tax related with Accelerating the Depreciation of Fixed Asset, GuoShuiFa(2009)No. 81
  Article 4 Enterprise income tax for State- encouraged high and new technology enterprise shall be levied at a reduced rate of 15% after recognition by relevant authority.
  Enterprise Income Tax Law of the People’s Republic of China, Article 28, and Regulation on the Implementation of the Enterprise Income Tax Law of the People's Republic of China, Article 93
  Article 5 For the fiscal fund to be included in income total amount an enterprise gets from financial authority of county-level or above government, as long as the fiscal fund meet the conditions at the same time of “capable of providing ear-marked capital disbursement document, the financial authority or other government agency that transfers the fund having special fund management measures or detailed management requirements to the fund, and independent calculation to the fund and the expenditure of the fund”, it can be deduced from the income total amount as nontaxable income when calculating the taxable income amount.
  Circular of the Ministry of Finance and the State Administration of Taxation on Enterprise Income Tax of Ear-marked Fiscal Fund, CaiShui (2011) No. 70
  1.2 Technical achievement transfer
  Article 6 Exempt business tax for the income any institution and individual gets in technical transfer, technical development and the relevant technical consultation and technical services.
  Circular of the Ministry of Finance and the State Administration of Taxation on implementing CPC Central Committee and State Council’s Decision on Strengthening Technical Innovation, Developing Hi-tech and Realizing Industrialization CaishuiZi No. [1999] 273
  Article 7 Within a tax year, a resident enterprise whose income obtained from technological transfer doesn’t exceed 5 million yuan shall be exempted from CIT (corporate income tax), and the excess shall be taxed at the reduced half rate.
  Regulation on the Implementation of the Enterprise Income Tax Law of the People's Republic of China, Article 90
  Article 8 The scope of the technical transfer resident enterprises are eligible for CIT exemption include resident enterprise transferring patent technology, computer software copyright, IC layout design right, new plant varieties, new bio- medicine varieties and other technologies defined by the Ministry of Finance and the State Administration of Taxation. Among them, the patent technology indicates invention and utility model that have legal exclusive right and the appearance designs that are not simple change of product pattern.
  Circular of the Ministry of Finance and the State Administration of Taxation on CIT Policy Issues about Resident Enterprise Technical Transfer, CaiShui (2010) No. 111
  1.3 Science and technology service
  Article 9 From January 1, 2008 to December 31, 2012, exempt the house tax and land-use tax to eligible incubators and S & T parks who use their own house property and land or provide their house property and land to incubator enterprises free of charge or by means of renting. Exempt the business tax for the income they get by renting site and house to incubator enterprises or by providing incubator services.
  Circular of the Ministry of Finance and the State Administration of Taxation on Extending the Taxation Policies Period to National University S & T Parks and S & T Incubators, CaiShui (2011) No. 59
  Article 10 Exempt the house tax and land-use tax to non-profit scientific research institutions who use their own house property and land.
  Circular of the Ministry of Finance and the State Administration of Taxation on Taxation Policies to Non-profit Scientific Research Institutions, CaiShui (2001) No. 5
  2. Policies to promote the development of strategic emerging industries
  2.1 Energy-saving, environmental protection and new energy
  Article 11 Where an enterprise uses any of the materials as listed in the Catalogue of Resources for Comprehensive Utilization by Enterprises Entitled to Preferential Income Tax Treatment as its major raw materials, the income obtained from producing products which are not restricted or prohibited by the state and which meet the relevant standards of the state or the industry concerned shall be calculated into the total income at the reduced 90%. The proportion of raw materials in the materials for the production of products as described in the preceding paragraph shall not be any lower than the standards described in the Catalogue of Resources for Comprehensive Utilization by Enterprises Entitled to Preferential Income Tax Treatment.
  Regulation on the Implementation of the Enterprise Income Tax Law of the People's Republic of China, Article 99
  Article 12 Where an enterprise purchases and actually uses any of the special equipment dedicated to environmental protection, conservation of energy and water, safety of work, etc. as described in the Catalogue of Special Equipment Dedicated to Environmental Protection Entitled to Preferential Income Tax Treatment, the Catalogue of Special Equipment Dedicated to Conservation of Energy and Water Entitled to Preferential Income Tax Treatment, and the Catalogue of Special Equipment Dedicated to Work Safety Entitled to Preferential Income Tax Treatment, 10% of the investment in the special equipment may be credited to the enterprise’s amount of taxes of the current year. If the amount of taxes is not sufficient for credit, the margin may be carried forward for credit in the following 5 tax years.
  Regulation on the Implementation of the Enterprise Income Tax Law of the People's Republic of China, Article 100
  Article 13 Where an enterprise purchases and actually uses any of the special equipment which have enjoyed preferential tax treatment, if the special equipment are transferred or rented within 5 tax years since the purchase date, the enterprise shall stop to enjoy CIT preferential treatment from the month the special equipment stops usage and make up the deducted CIT. 10% of the investment in the special equipment may be credited to the transferred enterprise’s amount of taxes of the current year. If the amount of taxes is not sufficient for credit, the margin may be carried forward for credit in the following 5 tax years.
  Circular of the Ministry of Finance and the State Administration of Taxation on the related issues of implementing the Catalogue of Special Equipment Dedicated to Environmental Protection Entitled to Preferential Income Tax Treatment, the Catalogue of Special Equipment Dedicated to Conservation of Energy and Water Entitled to Preferential Income Tax Treatment, and the Catalogue of Special Equipment Dedicated to Work Safety Entitled to Preferential Income Tax Treatment, CaiShui (2008) No. 48
  Article 14 Since January 1, 2008, where an enterprise purchases and actually uses any of the special equipment dedicated to environmental protection, conservation of energy and water, safety of work, including the lessee enterprise renting equipment by means of finance leasing and transferring the ownership of the leased equipment at the expiration of lease period stipulated in the finance leasing contract to the lessee enterprise, and the special equipment complies with stipulated conditions, then 10% of the investment in the special equipment may be credited to the transferred enterprise’s amount of taxes of the current year.
  Notice of the Ministry of Finance and the State Administration of Taxation on Several Issues Relevant to the Implementation of the Preferential Policies on Enterprise Income Tax
  CaiShui [2009] No. 69
  Article 15 The enterprises engaged in processing of public sewage, the processing of public garbage, the comprehensive exploitation and utilization of firedamp, the renovation of technologies of saving energy or discharging wastes, the desalination of sea water, etc. shall be exempted from the CIT for the first three years as of the tax year the first revenue arising from production or operation is attributable to, and shall be taxed at the reduced half rate for the fourth to the sixth years.
  Regulation on the Implementation of the Enterprise Income Tax Law of the People's Republic of China, Article 88
  Article 16 Halve the vehicle and vessel tax on energy-saving vehicles and vessels; exempt the vehicle and vessel tax on new energy vehicles and vessels.
  EV and fuel cell vehicle do not included in the vehicle and vessel tax collection scope.
      Vehicle and Vessel Tax Law of the People’s Republic of China, Article 4, The Implementation Regulation of the Vehicle and Vessel Tax Law of the People’s Republic of China, Article 10; Circular of the Ministry of Finance, the State Administration of Taxation and the Ministry of Industry and Information Technology on the Vehicle and Vessel Tax Policy of Energy-saving and New Energy Vehicles and Vessels, Caishui (2012) No. 19
  Article 17 Qualified energy-saving service companies engaging in energy management contracting projects are exempt from business tax for the business tax taxable income.
  Qualified energy-saving service companies engaging in energy management contracting projects that meet the relevant stipulations of the CIT Law are exempt from CIT for the first year to third year of participation, starting from the tax year in which it receives the first sum of manufacturing operation income. For the fourth to sixth years of participation, CIT will be levied at a rate of half of the 25 percent statutory tax rate.
  Circular of the Ministry of Finance and the State Administration of Taxation on Issues Concerning the Value-added Tax, Business Tax and Corporate Income Tax Policies for Promoting the Development of the Energy-saving Service Sector (Caishui [2010] No.110)
  2.2 Software, IC enterprises
  Article 18 Qualified software enterprises and IC design enterprises which are engaged in software development and test, information system integration, consultation and operation maintenance and IC design are exempted from business tax.
  Notice of the State Council on Issuing Several Policies on Further Encouraging the Development of the Software and Integrated Circuit Industries (No. 4 [2011] of the State Council)
  Article 19 Newly established IC design enterprises and qualified software enterprises with a first profit-making year commencing prior to 31 December 2017 are entitled to a two-year CIT exemption followed by a three-year 50% reduction of the 25% statutory tax rate. For a key software production enterprise within the national planning and layout, if it doesn’t entitled to taxation exemption of a year, then its CIT shall be levied as per 10% tax rate.
  The enterprises that are recognized to be entitled to original fixed term tax exemption and reduction before December 31, 2010 in accordance with Article 1 of Circular of the Ministry of Finance and the State Administration of Taxation on several Preferential Policies of CIT can continue to have the preferential policies until the end of the period.
  The qualified software and IC enterprises that are recognized after January 1, 2011 in accordance with the original measures for the administration of accreditation can apply to have the tax exemption and reduction preferential policies stipulated in CaiShui (2012) No. 27 before the promulgation of Measures for the Administration of IC Production Enterprises Accreditation, Measures for the Administration of IC Design Enterprises Accreditation and Measures for the Administration of Software Enterprise Accreditation mentioned in CaiShui (2012) No. 27.
  Circular of the Ministry of Finance and the State Administration of Taxation on the Tax Policies for Further Encouraging the Development of Software and Integrated Circuit Industries, CaiShui (2012) No. 27; Circular of the State Administration of Taxation on Issues related with Accreditation and Recognition of Software and IC Enterprises
  Article 20 With respect to the production enterprises of IC products whose product line is less than 0.8 micron (including 0.8 micron) wide, after certification, with a first profit-making year commencing prior to 31 December 2017 are entitled to a two-year CIT exemption followed by a three-year 50% reduction of the 25% statutory tax rate until the end of the period.
  With respect to the production enterprises of IC products whose product line is less than 0.25 micron wide or whose investment is over 8 billion yuan, after certification, are entitled to a reduced 15% CIT, for those enterprises whose business term is over 15 years and with a first profit-making year commencing prior to 31 December 2017 are entitled to a five-year CIT exemption followed by a five-year 50% reduction of the 25% statutory tax rate until the end of the period.
  The staff training expense of IC design enterprises and qualified software enterprises shall be calculated separately and be taken off when calculating the taxable income at the actual amount incurred.
  With respect to the outsourced software of a software or IC enterprise, as long as it meets fixed asset or intangible asset accreditation criterion, it can be calculated as fixed asset or intangible asset, and its depreciation and amortization period can be reduced to as short as 2 years.
  The depreciation period of the production equipment of IC production enterprises can be reduced as short as 3 years.
  Circular of the Ministry of Finance and the State Administration of Taxation on the Tax Policies for Further Encouraging the Development of Software and Integrated Circuit Industries, CaiShui (2012) No. 27;
  3. Policies to promote enterprises merger and acquisition
  Article 21 For taxpayers who, in the process of asset restructuring through merger, division, sale and   exchange, etc., transfer all or part of the physical assets and associated creditor's rights, debts and man powers to other entities and individuals, the aforesaid activities do not belong to the levying scope of business tax, and no business tax shall be levied on the transfer of real estate and land use rights involved.
  Circular of the State Administration of Taxation on Relevant Business Tax Issues Concerning Asset Restructuring of Taxpayers (No. 51 of 2011)
  Article 22 During enterprises merger, exempt the land value increment tax for the real estate transferred from the merged enterprise to the merging enterprise.
  Circular of the Ministry of Finance and the State Administration of Taxation on Land Value Increment Tax Specific Provisions of some Detailed Issues
  Article 23 If the enterprise reorganization meets all of the conditions in Article 5 of Caishui (2009) No. 59, each party involved may elect for Special Reorganization treatment in respect of the equity consideration of this transaction, which is generally as follows: Any gain recognized in a debt restructuring may be recognized evenly over a period of five years when such gain accounts for more than 50% of the debtor’s current year’s taxable income. If the new enterprise after merger and acquisition still qualifies conditions confirmed by taxation authority, it can continue to enjoy the taxation preferential policies of the original enterprise in accordance with relevant stipulations.
  Notice of the Ministry of Finance and the State Administration of Taxation on Enterprise Income Tax Treatment of Enterprise Reorganization, Caishui (2009) No. 59
  Article 24 Where non-company enterprises are entirely transformed into limited liability companies (including wholly state-owned companies) or joint-stock limited companies, or limited liability companies are entirely transformed into joint-stock limited companies, or joint-stock limited companies are entirely transformed into limited liability companies in accordance with the Company Law of the People's Republic of China, if the restructured companies succeed to the land use right and house ownership from the original enterprises, they shall be exempt from deed taxes.
  Where non-company wholly state-owned enterprises or wholly state-owned limited liability companies establish new companies with part of their assets, and the wholly state-owned enterprises (companies) hold no less than 50% of the stock of the new companies, then the new companies shall be exempt from deed taxes for the land use right and house ownership they succeed from the wholly state-owned enterprises (companies).
  Where state-holding enterprises make investment and establish new companies with part of their assets, and the state-holding enterprises take over 85% of the stock of the new companies, then the new companies shall be exempt from deed taxes for the land use right and house ownership they succeed from the state holding enterprises
  The valid period is from January 1, 2012 to December 31, 2014.
  Notice on Deed Tax Policies Concerning Reorganization and Restructuring of Enterprises and Public Institutions (Caishui [2012] No. 4)
  Article 25 No deed taxes shall not be levied for the transferring of equity (stock ) of qualified companies.
  No deed taxes shall be levied on qualified company merger, company separation, sale of enterprises, enterprise bankruptcy, debt-for-equity swap and assets transfer.
  The valid period is from January 1, 2012 to December 31, 2014.
  Notice on Deed Tax Policies Concerning Reorganization and Restructuring of Enterprises and Public Institutions (Caishui [2012] No. 4)
  Article 26 For the capital books of the enterprises which are approved to make restructuring by the people's governments above the county level and the departments in charge of the enterprises, the part that have stuck stamp do not need to stick stamp again, the part that have not stuck stamp or the newly added capital shall stick stamp as per provision. For all kinds of taxable contracts that are signed before enterprise reorganization and have not been completely implemented, it needs to change the execution subjects after reorganization, stamp tax shall not be levied for the contracts that have been stuck stamp before restructuring and have no change except the execution subjects. The ownership transfer instruments enterprises sign for restructuring are exempted from stamp tax.
  Notice of the Ministry of Finance and the State Administration of Taxation on Relevant Policies concerning Stamp Tax in the Process of Enterprise Restructuring, Caishui (2003) No. 183
  Article 27 Any behaviors that make equity investment in form of real estate or intangible assets, participate in acceptance of the profit distribution of investors and share the investment risk shall not be levied with business tax. Equity transfer shall be exempted from business tax.
  Notice of the Ministry of Finance and the State Administration of Taxation on Relevant Business Tax Issues concerning Transfer of Stockholder’s Equity, Caishui (2002) No. 191
  4. Policies to promote the development financial capital market
  4.1 Banks and non-bank financial institutions
  Article 28 After financial enterprises carry out risk classification to its agriculture-related loan and loans for SMEs in accordance with Guidelines on Risk-Based Loan Classification, Yinfa (2001) No. 416, the special reserve for loan losses made as per stipulated proportion is allowed to be deducted when calculating taxable income.
  Notice of the Ministry of Finance and the State Administration of Taxation on Policies concerning Pre-Enterprise Income Tax Deductions of Loan Loss Reserves for Financial Enterprises, Caishui (2009) No. 99; Notice of the Ministry of Finance and the State Administration of Taxation on Extending the Term of Implementation of the Pre-tax Deduction Policies for Financial Enterprises' Loss Provisions for Agriculture-related Loans and Loans for Small- and Medium-sized Enterprises, Caishui (2011) No. 104
  Article 29 From January 1, 2009 to December 31, 2013, the interest income obtained by a financial institution from granting petty loans to farmer households shall be exempt from the business tax.
  The interest income obtained by a financial institution from granting petty loans to farmer households shall be calculated into the total income at 90% in the calculation of taxable income.
  The insurance premium income obtained by an insurance company from providing insurance services for the crop farming industry and breeding industry shall be calculated into the total income at the reduced rate of 90% in the calculation of taxable income.
  From January 1, 2009 to December 31, 2015, the finance and insurance income obtained by a rural credit cooperative, a village bank, a rural mutual cooperative, a loan company wholly-funded and established by a banking institution, or a rural cooperative bank or rural commercial bank whose corporate body is located in an area at or below the county level (including a city, district or prefecture at county level) shall be subject to the business tax at the reduced rate of 3%.
  Notice of the Ministry of Finance and the State Administration of Taxation on the Relevant Tax Policies on Rural Finance, Caishui (2010) No. 4; Notice of the Ministry of Finance and the State Administration of Taxation on Extending the Implementation Period of Business Tax Policy for Rural Financial Institutions, Caishui (2011) No. 101
  4.2 Capital market
  Article 30 Where any venture capital enterprise adopts the mode of equity investment in the unlisted small and medium-sized high-tech enterprises for more than two years (including two years), if qualified for stipulated requirements, it may, based on 70% of its investment in small and medium-sized high-tech enterprises, deduct its amount of taxable income of the year when equity holding has lasted for two years; and any insufficient deduction of the year in question may be passed to the following tax year.
  Circular of the State Administration of Taxation on the Issues Concerning the Implementation of Preferential Income Tax Policies for Venture Capital Enterprises, Guoshuifa (2009) No. 87
  Article 31 The deductions from enterprise income tax on interest expenditures for enterprises borrowing money from their shareholders or other natural persons related to the enterprises shall be calculated in accordance with Article 46 of the Enterprise Income Tax Law of the People's Republic of China (hereinafter referred to as the Tax Law) and the requirements prescribed in the Notice of the Ministry of Finance and the State Administration of Taxation on Issues Relevant to the Tax Policies Regarding the Criteria for Enterprises' Pre-tax Deductions of Interest Expenditures Related to Affiliated Parties (No.121 [2008] of the Ministry of Finance).
  The part of the interest expenditures for enterprises borrowing money from their staff or other personnel other than aforesaid stipulation that is no more than the amount calculated as per financial enterprise similar loan interest rate of the time shall be allowed in accordance with the provisions of Article 8 of the Tax Law and Article 27 of the Implementation Regulation of the Tax Law as long as the borrowing situation complies with the following conditions at the same time. (1) the borrowing money between the enterprise and the personnel is authentic, legal and valid and does not for the purpose of illegal fund raising or has no other illegal behavior; (2) the enterprise and the personnel has signed loan contract.
  Notice of the State Administration of Taxation on Issues Regarding Pre-Tax Deductions from Enterprise Income Tax on Interest Expenditures for Enterprises Borrowing Money from Natural Persons, GuoShuiHan (2009) No. 777
  Article 32 Where an individual acquires the stocks of a listed company from public offering of the company or from the stock market, if the stock holding period is one month or less, the incomes from dividends and bonuses shall be included into the taxable incomes in full amount; if the stock holding period is more than one month up to one year, the incomes from dividends and bonuses shall be included into the taxable incomes at the reduced rate of 50% for the time being; and if the stock holding period is more than one year, the incomes from dividends and bonuses shall be included into the taxable incomes at the reduced rate of 25%.
  Notice of the Ministry of Finance, the State Administration of Taxation and China Securities Regulatory Commission on Issues concerning the Implementation of Differential Individual Income Tax Policies on Dividends and Bonuses of Listed Companies, Caishui [2012] No. 85
  Article 33 For the financing lease companies which carry out sale-and-leaseback business and accept the ownership of the residential properties and land rights of the lessees, the deed tax shall be levied in accordance with the regulations. If the lessees repurchase the ownership of the residential properties and land rights after expiry of the sale-and-leaseback contract, deed tax will be exempted.
  Institution or individual increases capital by assets other than real estates and land to expand its/ his equity stake in the invested company, no matter the invested company makes change registration at the commerce and industry authority, no deed tax shall be levied as long as there is real estates or land ownership transfer.
  Notice of the Ministry of Finance and the State Administration of Taxation on Deed Tax Policies concerning the Fund-raising by Enterprise by Means of Sale and Leaseback, Caishui (2012) No. 82
  5. Policies to promote the development of modern logistics
  5.1 Traffic & transportation
  Article 34 As of January 1, 2010, international transportation services provided by entities or individuals within the territory of the People's Republic of China (hereinafter referred to as “within the territory”) are exempted from business taxes.
  Notice of the Ministry of Finance and the State Administration of Taxation on the Exemption of Business Tax from International Transportation Services, Caishui (2010) No. 8
  Article 35 For a taxpayer who sublets any transportation business it has contracted to any other entity or individual, the turnover shall be the balance of the total consideration and additional fees and charges less the transport costs paid to other entities or individuals;
  Interim Regulation of PRC Business Tax, Article 5
  Article 36 The taxpayer shall, for engaging in the NVOCC business, declare and pay the business tax on the basis of the balance of all the fees and other expenses collected from the client deducted by the amount of freight, customs declaration charges, port incidental expenses and loading and unloading fees, etc.
  Notice of the State Administration of Taxation on the Business Tax on Non Vessel Operating Common Carrier Business, GuoShuiHan (2006) No. 1312
  Article 37 Any logistic enterprise that is included in the national trial logistic enterprises list and outsources its transportation business and warehouse business to other institutions shall pay the business tax on the basis of the balance of all income deducted by the amount of the freight it pays to other transportation enterprises and the warehousing expenses it pays to other warehousing institutions.
  Notice of the State Administration of Taxation on Tax Policies for Pilot Logistics Enterprises, GuoShuiFa [2005] No. 208
  Article 38 The vehicles and vessels that run or operate within airport, port, railway station and yard and do not need to register at vehicle and vessel registration authority shall be exempted from the vehicle and vessel tax within 5 years from January 1, 2012.
  The Implementation Regulation of the Vehicle and Vessel Tax Law of the People’s Republic of China, Article 25
  5.2 Warehousing and logistics
  Article 39 From January 1, 2012 to December 31, 2014, the urban and town land use tax to the self-owned land for bulk commodity storage facilities (including inhouse use and lease) of logistic enterprises shall be levied at 50% of the applicable tax rate of the area it locates.
  Notice of the Ministry of Finance and the State Administration of Taxation on Urban and Town Land Use Tax Policies for the Land Used by Logistics Enterprises for Bulk Commodity Storage Facilities, Caishui (2012) No. 13
  Article 40 For the large modern logistic parks, centers and enterprises that serve national encouraged industrial cluster areas and have difficulty to pay the urban and town land use tax as per stipulations, the urban and town land use tax can be reduced after approval in accordance with the tax administrative jurisdiction. For the logistic enterprises that have difficulty to pay property tax and land use tax for their self-usage real estates of their production and business operation, the property tax and land use tax can be reduced or exempted after approval for a period of time.
  Opinions of Shandong Provincial Government on Implementing GuoBanFa (2011) No. 38 Document to Promote the Healthy Development of Logistic Industry
  Article 41 The logistic enterprises that receive the transportation and warehousing business separated from manufacturing enterprises and railway special lines and freight yards and depots are entitled to qualify for the relevant tax and asset disposal supportive policies in accordance with the requirements of Notice of the Ministry of Finance and the State Administration of Taxation on Several Issues Concerning the Enterprise Income Tax Treatment on Enterprise Reorganization (Caishui (2009) No. 59) and Notice on Deed Tax Policies Concerning Reorganization and Restructuring of Enterprises and Public Institutions (Caishui [2012] No. 4).
  Opinions of Shandong Provincial Government on Implementing GuoBanFa (2011) No. 38 Document to Promote the Healthy Development of Logistic Industry
  Article 42 From January 1, 2013 to December 31, 2015, the house tax and urban land use tax for the real estates and land used by dedicated agricultural product wholesale markets and farmers’ markets are temporarily exempted. And the house tax and urban land use tax for the real estates and land used by agricultural product wholesale markets and farmers’ markets that operate other products other than agricultural products shall be exempted as per the ratio of the business operation area of other products and agricultural products.
  Notice of the Ministry of Finance and the State Administration of Taxation on Policies Concerning House Tax and Urban Land Use Tax on Agricultural Product Wholesale Markets and Farmers' Markets (Caishui (2012) No. 68)
  6 Policies to promote commercial service and intermediate service
  6.1 Financing lease
  Article 43 From October 1st of 2010, the sale of assets by lessee in the financing after-sale lease-back business doesn’t belong to the imposition scope of business tax any longer, so business tax will not be imposed.
  The sale of assets by lessee in financing after-sale lease-back business is not identified as sales revenue. The assets subject to financing lease will still be depreciated according to the original book value as tax base before selling by lessee. During the lease period, the financing interest paid by the lessee will be deducted before tax as financial cost of the enterprise.
  (Announcement of State Administration of Taxation on tax issues related to the sale of assets by lessee in financing after-sale lease-back business, [2010] No.13)
  6.2 Commercial service
  Article 44 The business turnover of agency is the remuneration actually charged to the client by the tax payer for agency service.
  (Notice of State Administration of Taxation on issues related to business tax, GSF [1995] No.76)
  Article 45 The business turnover of advertising agency is the total revenue deducted by advertising fees paid to other advertising companies or advertising publishers (including media and carriers).
  (Notice of Ministry of Finances and State Administration of Taxation on policy issues related to business tax, CS [2003] No.16)
  Article 46 The stamp tax is not levied on the agreement of agency signed between the agency and the entrusting party.
  (Notice of State Administration of Taxation on interpretation and provisions of detailed issues related to stamp tax, GSF [1991] No.155)
  Article 47 The services provided by units in the territory of the People’s Republic of China are exempt from business tax: (1) supervision of construction project of which the subject matter is out of the territory; (2) overseas seamen employment; (3) personnel management completely occurring out of the territory provided to foreign units by means of foreign labor cooperation.
  (Notice on exemption of business tax of labor service such as overseas seamen employment, CS [2002] No.54)
  7 Policies to promote the development of travel, entertainment and exhibition businesses
  7.1 Travel business
  Article 48 For taxpayers engaged in the business of travel, the turnover shall be the balance of the total consideration and additional fees and charges less the costs of accommodation, meals, transportation, and admission tickets for tourist attractions paid on behalf of tourists to other entities and individuals and the travel expenses paid to other tourist enterprises receiving tours;
  Interim Regulation of PRC Business Tax, Article 5
  Article 49 Income from admission tickets collected for cultural activities by memorial halls, museums, cultural centers, governing bodies of the protected historic and cultural sites, art galleries, exhibition halls, academies of painting and calligraphy, and libraries; and income from admission tickets collected for cultural and religious activities at places of worship shall be exempt from the business tax.
  Interim Regulation of PRC Business Tax, Article 8
  7.2 Entertainment business
  Article 50 From October 1st of 2011, two grades of tax rate are applicable to the business tax on entertainment business of Shandong Province, in which, tax rate of golf entertainment business is adjusted from 20% to 10%, while tax rate of other entertainment businesses is adjusted from 20% to 5%.
  (Notice of Financial Department of Shandong Province and Local Tax Bureau of Shandong Province on adjustment of business tax rate applicable to entertainment business of Shandong Province, LCS [2011] No.72)
  7.3 Exhibition business
  Article 51 The taxable business turnover of the tax payer who sponsor (or organize) conferences or exhibitions is the total amount charged from exhibitors, participants of conferences and visitors plus other charges deducted by venue rental, stand building fee, advertising fee, transport cost and accommodation cost paid by tax payer, and the business tax will be levied in the tax item of “service-agency”.
  For tax payer who is sponsor (or general organizer) of conferences and exhibitions and who entrusts an organizer to organize conferences or exhibitions, the taxable business turnover is the total amount charged directly from exhibitors, participants of conferences and visitors and other charges deducted by relevant costs he paid to the organizer and the business tax will be levied in the tax item of “service-agency”.
  For tax payer who organizes exhibitions and conferences entrusted by the sponsor (or general organizer), the taxable business turnover is the total amount charged from the sponsor (or general organizer) and other charges deducted by venue rental, stand building fee, advertising fee, transport cost and accommodation cost paid by tax payer and the business tax will be levied in the tax item of “service-agency”.
  (Notice of Local Tax Bureau of Qingdao on issues related to business tax of exhibition business, QDSH [2010] No.68)
  8 Policies to promote infrastructure development
  Article 52 For enterprises undertaking public infrastructure projects (port and wharf, airport, railway, highway, urban public transport, electricity, water conservancy, etc.) in accordance with relevant conditions and technical standards of Catalog of Preferential Corporate Income Tax on Public Infrastructure Projects and relevant national investment management rules and approved after January 1st of 2008, their revenues from investment and operation can be exempt from corporate income tax from the first year to the third year of having production and business revenue and they can pay half of corporate income tax from the fourth year to the sixth year.
  (Notice of Ministry of Finances and State Administration of Taxation on issues related to the implementation of Catalog of Preferential Corporate Income Tax on Public Infrastructure Projects, CS [2008] No.46)
  Article 53 For enterprises that undertake public infrastructure projects in accordance with Catalog of Preferential Corporate Income Tax on Public Infrastructure Projects and approved before December 31st of 2007 and that undertake environment protection, energy and water saving projects in accordance with Catalog of Preferential Corporate Income Tax on Environment Protection, Energy and Water Saving Projects and approved before December 31st of 2007, their revenues from investment and operation can enjoy the preferential policy of exemption for three years and reduction by half for three years of corporate income tax from January 1st of 2008 and during the remaining years of the preferential period of corporate income tax beginning from the taxable year when they get the first production and operation revenue from the projects according to new Tax Law.
  (Notice of Ministry of Finances and State Administration of Taxation on issues related to the preferential policy for corporate income tax of public infrastructure projects and environment protection, energy and water saving projects, CS [2012] No.10)
  Article 54 All temporary buildings such as work shed, material shed, rest shed, office, canteen, water boiler building, car parking building constructed on the infrastructure construction site and provide on-site service, whether constructed by constructing enterprise itself or invested and constructed by the infrastructure owner for constructing enterprise’s use, are exempt from house property tax during construction period.
  (Interpretation and temporary rules of Ministry of Finances and State Administration of Taxation on detailed issues related to house property tax [86] CSDZ No.8)
  Article 55 Sewage treatment service provided by units and individuals doesn’t belong to taxable labor service for business tax. The sewage treatment fee charged for their service is exempt from business tax.
  (Reply of State Administration of Taxation to exemption of business tax on sewage treatment fee, GSH [2004] No.1366)
  Article 56 The garbage disposal service provided by units and individuals doesn’t belong to taxable labor service. The garbage disposal fee charged for their service is exempt from business tax.
  (Reply of State Administration of Taxation to exemption of business tax on garbage disposal fee, GSH [2005] No.1128)
  Article 57 The water conservancy facilities and their management and protection land (such as lands for reservoir area, dam, beware, irrigation channel, pomp station, etc.) are exempt from urban land use tax.
  (Rules of State Administration of Taxation on issues related to exemption from land use tax for land for water conservancy facilities, [89] GSDZi No.14)
  Article 58 The land formed by cutting into the mountain or filling the sea and the abandoned land transformed after approval is exempt from urban land use tax for 10 years from the month of use.
  (Article 6 of Temporary Rules for Urban Land Use Tax of the People’s Republic of China, No.483 Decree of State Council; Comments of Financial Department of Shandong Province on implementation by Shandong Province of Temporary Rules for Urban Land Use Tax of the People’s Republic of China, [89] LCSZi No.4)
  9 Policies to promote the development of agriculture, forestry, husbandry and fishery
  Article 59 The enterprise’s income obtained from agricultural, forest, animal raising, and fishing projects shall be exempt from the CIT excluding any projects restricted or prohibited by the state: the planting of vegetables, cereals, potatoes, oil plants, beans, cotton, hemps, sugar plants, fruits, nuts, etc.; breeding of new varieties of crops; planting of traditional Chinese medicinal herbs; cultivation and planting of forest trees; raising of animals and poultry; gathering of forest products; other agricultural, forest, animal raising and fishing projects such as irrigation, initial processing of agricultural products, veterinary science, promotion of agricultural techniques, operations and reparation of agricultural machines, etc.; ocean fishing. The enterprise’s income obtained from the following project shall be subject to income tax levy at the reduced half rate: the planting of flowers, teas, and other beverage plants and spicery plants; maritime aquaculture and inland aquaculture.
  Regulation on the Implementation of the Enterprise Income Tax Law of the People's Republic of China, Article 86
  Article 60 The products of agriculture, forestry, husbandry and fishery purchased by the enterprise and replanted or cultivated in the self-owned or leased field and change in their biologic form after a certain growing period, but the use value of the products is not obviously increased due to processing of the agricultural products in this phase, it can be regarded as agricultural planting and cultivation projects which can enjoy corresponding preferential tax policy.
  The income of enterprises from entrusting other enterprises or individuals to undertake agriculture, forestry, husbandry and fishery projects stipulated in Article 86 of the Rules can enjoy corresponding preferential tax policy. The income of enterprises from being entrusted to undertake agriculture, forestry, husbandry and fishery projects stipulated in Article 86 of the Rules can enjoy preferential tax policy corresponding to that of entrusting party.
  (Announcement of State Administration of Taxation on issues related to the implementation of preferential corporate income tax for agriculture, forestry, husbandry and fishery projects, [2011] No.48)
  Article 61 The enterprises specializing in agriculture, forestry, husbandry and fishery projects in business mode of “company + farmer” can enjoy preferential policy of exemption and reduction of income tax according to the provisions of Article 86 of the Rules of Implementation of Corporate Income Tax of the People’s Republic of China.
  (Announcement of State Administration of Taxation on issues related to preferential corporate income tax of enterprises in business mode of “company + farmer”, [2010] No.2)
  Article 62 The land used by operating and managing unit of drinking water project for constructing drinking water project is exempt from land use tax. The property transfer document signed for getting land use right for constructing drinking water project and the construction project contract signed with the constructing unit are exempt from stamp tax. The production and office buildings and lands for self-use are exempt from house property tax and urban land use tax.
  (Notice on taxation policy supporting construction and operation of rural drinking water safety project, CS [2012] No.30)
  Article 63 The land use right transferred to farmers for agricultural production is exempt from business tax.
  (Notice of Ministry of Finances and State Administration of Taxation on exemption from business tax for several projects, [1994] CSZi No.2)
  Article 64 The lands for agriculture, forestry, husbandry and fishery and the buildings and lands for residence of farmers are exempt from house property tax and land use tax.
  (Notice of State Administration of Taxation on interpretation and provision of adjusting taxation scope of building tax and land use tax, GSF [1999] No.44)
  Article 65 For units and individuals specializing in picking and sightseeing agriculture within the imposition scope of urban land use tax, the lands directly used for planting, cultivation and husbandry for picking and sightseeing are exempt from urban land use tax.
  (Notice of Ministry of Finances and State Administration of Taxation on policies related to house property tax and urban land use tax, CS [2006] No.186)
  Article 66 The purchases and sales contracts for agricultural products and agricultural production materials signed between farmers’ professional cooperatives and their members are exempt from stamp tax. Farmers’ professional cooperative is established and registered in accordance with Law of Farmers’ Professional Cooperative of the People’s Republic of China.
  (Notice of Ministry of Finances and State Administration of Taxation on tax policy related to farmers’ professional cooperative, CS [2008] No.81)
  10 Policies to promote the development of culture, education and health
  10.1 Culture
  Article 67 The revenue from assigning film copyright, the revenue from issuing films and the revenue from projecting films in countryside of the cultural enterprises are exempt from business tax.
  The revenues earned from overseas for performances in overseas of culture enterprises are exempt from business tax.
  The dead stock of publications, such as paper books exceeding five years (including the year of publishing, the same below), audiovisual products, electronic publications and slides (including micro products) exceeding two years, paper periodicals, wall calendars and New Year pictures exceeding one year, can be deducted truly before tax as property loss.
  (Notice of Ministry of Finances, General Administration of Customs and State Administration of Taxation on issues related to tax policies supporting development of cultural enterprises, CS [2009] No.31)
  Article 68 The commercial cultural institutions transformed to enterprises are exempt from corporate income tax from the date of registration of transformation till December 31st of 2013.
  If the cultural units to which Ministry of Finances allocate undertaking expenditures were transformed to enterprises from January 1st of 2009 to December 31st of 2013, their houses for self-use should be exempt from house property tax from the date of registration of transformation.
  (Notice of Ministry of Finances and State Administration of Taxation on preferential tax policies for commercial cultural institutions transformed to enterprises during cultural system reform, CS [2009] No.34)
  Article 69 The revenue from entrance tickets of science popularizing units and revenue from entrance tickets of science popularizing activities organized by party and government departments and associations for science and technology of counties (including cities of county level, districts, banners) or higher levels of administration are exempt from business tax from January 1st of 2011 to December 31st of 2012.
  (Notice of Ministry of Finances and State Administration of Taxation on proceeding with implementation of preferential policies related to VAT and business tax for propagation and culture causes, CS [2011] No.92)
  Article 70 The identified cartoon enterprises that self-develop and produce cartoon products can apply for current national preferential policies related to corporate income tax for encouraging development of software industry.
  (Notice of Ministry of Finances and State Administration of Taxation on issues related to tax policies supporting development of cartoon industry, CS [2009] No.65)
  Article 71 From January 1st of 2011 to December 31st of 2012, the identified cartoon enterprises enjoy a reduced business tax of 3% for the revenue from services for developing cartoon products such as compilation of cartoon scripts, image design, background design, cartoon design, storyboard, animation, production, tracing, coloring, composition, dubbing, underscoring, sound mixing, film editing, subtitling, compressing and transcoding (adaptation to online comics and mobile comics formats) and the revenue from transaction of cartoon copyright within the territory (including authorization and sub-authorization of cartoon brands, images or contents).
  (Notice of Ministry of Finances and State Administration of Taxation on policies related to VAT and business tax supporting development of cartoon industry, CS [2009] No.119)
  Article 72 From January 1st of 2009, the units or individuals established in the territory of the People’s Republic of China who provide cultural or sportive services (except for broadcasting on TV) out of the territory of the People’s Republic of China are exempt from business tax temporarily.
  (Notice of Ministry of Finances and State Administration of Taxation on policies of tax exemption related to business tax for purchase and sale of individual financial products, CS [2009] No.111)
  10.2 Education
  Article 73 For the schools providing degree courses, their revenues from providing educational service are exempt from business tax.
  The revenues of nurseries and kindergartens from providing raising service are exempt from business tax.
  The houses and lands for self-use of schools, nurseries and kindergartens invested by enterprises are exempt from house property tax and urban land use tax.
  The farmlands requisitioned by schools and kindergartens after approval are exempt from farmland occupation tax.
  (Notice of Ministry of Finances and State Administration of Taxation on policies of taxation on education causes, CS [2004] No.39)
  Article 74 The raising services provided by nursing homes and welfare institutions for disabled persons are exempt from business tax.
  The farmlands occupied by nursing homes are exempt from farmland occupation tax.
  The houses for self-use of charity and non-profitable old people service institutions invested by government departments, enterprises, institutions, social organizations and individuals are exempt from house property tax temporarily.
  (Article 8 of Temporary rules for business tax of the People’s Republic of China; Article 8 of Temporary Rules for farmland occupation tax of the People’s Republic of China; Notice of Ministry of Finances and State Administration of Taxation on issues related to taxation policies for old people service institutions, CS [2000] No.97)
  10.3 Health
  Article 75 The medical services provided by hospitals, clinics and other medical institutions are exempt from business tax.
  The houses and lands for self-use of non-profitable medical institutions are exempt from house property tax and urban land use tax.
  (Article 8 of Temporary rules for business tax of the People’s Republic of China; Notice of Ministry of Finances and State Administration of Taxation on taxation policies for medical and health institutions, CS [2000] No.42)
  Article 76 The revenues of non-profitable organizations compliant with the conditions are tax free.
  (Article 26 of Law of Corporate Income Tax of the People’s Republic of China)
  11 Policies to promote the development of small and micro-enterprises and individual industrial and commercial enterprises
  11.1 Reduction of burden
  Article 77 To adjust the threshold of business tax from November 1st of 2011. The threshold of business tax paid on schedule (excluding house leasing) is a monthly sales of RMB 20,000 Yuan and the threshold of business tax for house leasing is a monthly sales of RMB 5,000 Yuan. The threshold of business tax paid per view is a sales of RMB 500 Yuan per time (day).
  (Notice of Financial Department of Shandong Province, State Tax Bureau of Shandong Province and Local Tax Bureau of Shandong Province on adjustment of thresholds of VAT and business tax, LCS [2011] No.91)
  Article 78 The small low-profit enterprises compliant with conditions and specializing in industries non-restricted and non prohibited by the state can enjoy a reduced tax rate of 20% of corporate income tax.
  From January 1st of 2012 to December 31st of 2015, for the small low-profit enterprises whose taxable income is equal or less than RMB 60,000 Yuan, their income can be cut by 50% as taxable income and their corporate income tax rate is 20%.
  (Article 90 of Implementation rules for corporate income tax of the People’s Republic of China; Notice of Ministry of Finances and State Administration of Taxation on issues related to preferential policies for corporate income tax of small low-profit enterprises, CS [2011] No.117)
  Article 79 For small low-profit enterprises whose taxable income of the previous taxable year is equal to or less than RMB 60,000 Yuan and who are compliant with the criteria of assets and number of employees in Article 92 of Implementation rules for corporate income tax of the People’s Republic of China and who prepay corporate income tax according to actual profit, when they declare and prepay corporate income, the "actual total profit" in Line 9 of Application Form of monthly(quarterly) prepayment and declaration of corporate income tax of the People's Republic of China (Category A) according to the Announcement of State Administration of Taxation on publishing statements such as Application Form of monthly(quarterly) prepayment and declaration of corporate income tax of the People's Republic of China (Announcement of State Administration of Taxation [2011] No.64) will be multiplied by 15% and the product shall be filled into Line 12 "income tax reduced or exempt".
  (Announcement of State Administration of Taxation on issues related to prepayment of corporate income tax of small low-profit enterprises, [2012] No.14)
  Article 80 The small and micro-enterprises who have difficulty in paying house property tax and urban land use tax can apply for reduction or exemption of tax with competent local tax bureau. The preferential tax exemption for a certain period will be granted after approval of the competent local tax bureau.
  (Article 7 of Temporary rules for urban land tax of the People's Republic of China, No.483 Decree of State Council; Notice of Qingdao Local Tax Bureau on reduction and exemption of house property tax and urban land use tax due to difficulty of tax payers, QDSF [2009] No.81)
  Article 81 The small and micro-enterprises who have special difficulty and cannot pay tax on schedule can apply for a deferred payment of tax within three months according to law.
  (Article 31 of Law of Taxation Management of the People's Republic of China)
  Article 82 From October 1st of 2011 to September 30th of 2014, the revenue from housekeeping services provided by small and micro housekeeping service enterprises or staff housekeepers are exempt from business tax.
  (Notice of Ministry of Finances and State Administration of Taxation on exemption of business tax for staff-type housekeeping service, [2011] No.51)
  Article 83 The reasonable expenses of enterprises arising from financing modes such as issuing bonds, obtaining loans and absorbing deposit of insured shall be included into relevant asset cost if they're compliant with conditions of capitalization and shall be included into financial expenses if not conform with conditions of capitalization and they're allowed to be deducted truly before paying corporate income tax.
  (Announcement of State Administration of Taxation on issues related to taxation of taxable income of enterprises, [2012] No.15)
  Article 84 If the operator of an individual industrial and commercial enterprise assigns the house and land ownership under his name to the individual industrial and commercial enterprise, or if the individual industrial and commercial enterprise assign the house and land ownership under his name to the original operator, the assignments are exempt from contract tax.
  If a partner of a partnership enterprise assigns the house and land ownership under his name to the partner enterprise, or if the partner enterprise assigns the house and land ownership under his name to the original partner, these assignments are exempt from contract tax.
  (Notice of Ministry of Finances and State Administration of Taxation on contract tax policies related to financing by after-sale lease-back of enterprises, CS [2012] No.82)
  11.2 Financing of enterprises
  Article 85 From November 1st of 2011 to October 31st of 2014, the loan contracts signed between financial institutions and small and micro-enterprises are exempt from stamp tax.
  (Notice Ministry of Finances and State Administration of Taxation on exemption of stamp tax for loan contracts signed between financial institutions and small and micro-enterprises, CS [2011] No.105)
  Article 86 The revenues of listed middle and small-sized credit guarantee institutions from guarantee and re-guarantee businesses obtained according to the standards of the People's government of prefecture and higher levels where they're located are exempt from business tax within three years from the date of handling tax exemption by competent tax bureau.
  (Notice of Ministry of Industry and Information and State Administration of Taxation on publishing and canceling the list of middle and small-sized credit guarantee institutions exempt from business tax, GXBLQY [2010] No.462; Notice of Ministry of Industry and Information and State Administration of Taxation on issues related to publishing of the list of middle and small-sized credit guarantee institutions exempt from business tax, GXBLQY [2011] No.68)
  Article 87 The guarantee compensation reserve fund withdrawn by middle and small-sized credit guarantee institutions compliant with conditions at no more than 1% of guarantee liability balance at the end of the same year can be deducted before corporate income tax and the guarantee compensation reserve balance withdrawn during the last year shall be transferred to current revenue.
  The unearned liability reserve fund withdrawn by middle and small-sized credit guarantee institutions compliant with conditions at no more than 50% of the current guarantee fee is allowed to be deducted before corporate income tax and the unearned liability reserve balance withdrawn during the last year shall be transferred to current revenue.
  Execution period is from January 1st of 2011 to December 31st of 2015.
  (Notice of Ministry of Finances and State Administration of Taxation on policies of deduction before corporate income tax of reserves related to middle and small-sized credit guarantee institutions, CS [2012] No.25)
  12 Policies to promote employment and entrepreneurship
  12.1 Laid-off workers and unemployed persons (including graduates from colleges)
  Article 88 For persons who hold Employment and Unemployment Registration Certificate (indicating "tax policy for self-employment" or attached with Self-employment Certificate of Graduates from Colleges) and undertake individual businesses (except for construction, entertainment, selling real estate, transferring land use right, advertisement, real estate intermediate, sauna, massage, cyber cafes, oxygen bars, etc.), RMB 8,000 Yuan at maximum is deducted in sequence from business tax, urban maintenance and construction tax, educational surtax and personal income tax to be actually paid by each household every year for three years. the approval period for the preferential tax policy is from January 1st of 2011 to December 31st of 2013. The tax payer will enjoy the preferential policy from the date of handling tax reduction and exemption formalities at the tax bureau.
  If trading enterprises, service enterprises (except advertisement, real estate intermediate, pawn broking, sauna, massage, oxygen bars, etc.), processing enterprises and small processing enterprises of community among the labor employment service enterprises hire new employees holding Employment and Unemployment Registration Certificate and sign labor contracts of at least one year with these employees and pay social insurance charges according to law, their business tax, urban maintenance and construction tax, educational surtax and corporate income tax can be deducted in quota for three years according to number of employees they actually hire. The quota standard of Qingdao is RMB 4,800 Yuan every person every year.
  (Notice of Ministry of Finances and State Administration of Taxation on tax policies supporting and promoting employment, CS [2010] No.84)
  12.2 Demobilized army cadres, discharged soldiers and soldiers’ families
  Article 89 The demobilized army cadres undertaking individual businesses, after approval by competent tax bureaus, can be exempt from business tax and personal income tax for three years from the date of getting Tax Registration Certificate.
  The enterprises newly established for employment of demobilized army cadres who choose employment by themselves, if the number of employed demobilized army cadres represent at least 60% of the total number of employees of the enterprise, after approval of competent tax bureau, can be exempt from business tax for three years from the date of getting Tax Registration Certificate.
  (Notice of Ministry of Finances and State Administration of Taxation on tax policies related to demobilized army cadres who choose employment by themselves, CS [2003] No.26)
  Article 90 The urban discharged soldiers who find jobs on their own and undertake the following industries after the distribution of the Notice of General Office of State Council transferred to Ministry of Civil Affairs and other departments on the comments on preferential policies supporting self-employment of urban discharged soldiers (GBF [2004] No.10) can enjoy the following preferential tax policies:
  Those who undertake individual businesses (except for construction, entertainment, advertisement, sauna, massage, cyber cafes, oxygen bars) are exempt from business tax, urban maintenance and construction tax, educational surtax and personal income tax for three years from the date of getting Tax Registration Certificate.
  Those who undertake planting or cultivating businesses will pay personal income tax according to the national regulations for personal income tax of planting and cultivating businesses.
  The service enterprises newly established for employment of urban discharged soldiers who find jobs on their own (except advertisement, sauna, massage, cyber cafes and oxygen bars), if the number of employed urban discharged soldiers represent at least 30% of the total number of employees of the enterprise and if the enterprise sign labor contracts with them for at least one year, after identification by authority of civil affairs of county and higher levels and approval of competent tax bureau, can be exempt from business tax and attached urban maintenance and construction tax and educational surtax for three years.
  The commercial retail enterprises newly established for employment of urban discharged soldiers who find jobs on their own, if the number of employed urban discharged soldiers represent at least 30% of the total number of employees of the enterprise and if the enterprise sign labor contracts with them for at least one year, after identification by authority of civil affairs of county and higher levels and approval of competent tax bureau, can be exempt from urban maintenance and construction tax and educational surtax for three years.
  (Notice of Ministry of Finances and State Administration of Taxation on preferential tax policies supporting self-employment of urban discharged soldiers, CS [2004] No.93)
  Article 91 The soldiers’ families undertaking individual businesses are exempt from business tax for three years from the date of getting Tax Registration Certificate.
  The enterprises newly established for employment of soldiers’ families are exempt from business tax from the date of getting Tax Registration Certificate, if the number of employed soldiers’ families represents at least 60% of the total number of employees and is certified by political and logistics authority of army or higher level and the soldiers’ families shall have the identity certificate issued by political authority of division or higher level.
  (Notice of Ministry of Finances and State Administration of Taxation on tax policies related to employment of soldiers’ families, CS [2000] No.84)
  12.3 Disabled persons
  Article 92 For the enterprises employing disabled persons, the salary actually paid to disabled employees can be double deducted before paying corporate income tax.
  (Notice of Ministry of Finances and State Administration of Taxation on preferential policies for corporate income tax related to employment of disabled persons, CS [2009] No.70)
  Article 93 If the average number of employed disabled persons every month is at least 25% of the total number of employees and the total number of disabled employees is at least 10 persons and the revenue from service represents at least 50% of the sum of revenues subject to VAT and business tax, the business tax can be reduced according to the number of disabled employees, i.e. 6 times the minimum salary approved by Qingdao People’s Government but at maximum RMB 35,000 Yuan every person every year.
  If the average number of employed disabled persons every month is at least 25% of the total number of employees and the total number of disabled employees is at least 10 persons within a taxable year, the enterprise is exempt from house property tax and urban land use tax of the same year.
  (Notice of Ministry of Finances and State Administration of Taxation on preferential tax policies promoting employment of disabled persons, CS [2007] No.92; Notice on issues related to preferential policies for house property tax and urban land use tax to promote employment of disabled persons, LDSH [2008] No.102; Notice of transferring Notice of Ministry of Finances and State Administration of Taxation on policies related to urban land use tax of units employing disabled persons, LCS [2011] No.6)
  13 Policies to promote construction of affordable housing
  13.1 Public rental apartments
  Article 94 The lands used for construction of public rental apartments and the lands occupied by public rental apartments after construction are exempt from urban land use tax. Other housing projects including public rental apartments can be exempt from urban land use tax concerning construction and management of public rental apartments in proportion to the percentage of the construction area of public rental apartments in total construction area according to relevant documents issued by government departments.
  The operating and managing units of public rental apartments are exempt from stamp tax related to construction of public rental apartments. Other housing projects including public rental apartments can be exempt from stamp tax concerning construction and management of public rental apartments in proportion to the percentage of the construction area of public rental apartments in total construction area according to relevant documents issued by government departments.
  The operating and managing units of public rental apartments are exempt from contract tax and stamp tax for apartments purchased as public rental apartments. The two parties of rental agreements for renting public rental apartments are exempt from stamp tax. 
  If the enterprises, institutions, social organizations and other organizations that transfer their old houses as source of public rental apartments and the added values don’t exceed 20% of the amount of deducted items, the relative revenues are exempt from land VAT.
  The rental revenues from operating public rental apartments are exempt from business tax and house property tax.
  (Notice of Ministry of Finances and State Administration of Taxation on preferential tax policies to support construction and operation of public rental apartments, CS [2010] No.88) 
  13.2 Low-rent apartments and economically affordable apartments
  Article 95 The developers who include low-rent apartments in their projects of economically affordable apartments and commercial apartments or include economically affordable apartments in their commercial apartments projects can be exempt from urban land use tax and stamp tax in proportion to the percentage of the construction area of low-rent apartments and economically affordable apartments in the total construction area, if they can provide relevant documents issued by government departments.
  If the enterprises, institutions, social organizations and other organizations that transfer their old houses as source of low-rent apartments and economically affordable apartments and the added values don’t exceed 20% of the amount of deducted items, the relative revenues are exempt from land VAT.
  The operating and managing units of low-rent apartments and economically affordable apartments are exempt from stamp tax concerning low-rent apartments and economically affordable apartments. The lessees of low-rent apartments and the purchasers of economically affordable apartments are exempt from relative stamp tax.
  The operating and managing units of low-rent apartments who purchase apartments as low-rent apartments or the operating and managing units of economically affordable apartments who buy back these apartments as source of economically affordable apartments again are exempt from contract tax.
  From March 1st of 2008, the enterprises, institutions, social organizations and other organizations who rent houses to individuals for living shall pay house property tax at a reduced rate of 4%.
  (Notice of Ministry of Finances and State Administration of Taxation on tax policies related to low-rent apartments and economically affordable apartments and house rental, CS [2008] No.24)
  13.3 Transformation of shantytowns
  Article 96 The lands used for construction of houses for transformation and resettlement of city-owned and state-owned industrial and mineral shantytowns (hereinafter referred to as transformation and resettlement houses are exempt from urban land use tax. The operating and managing units and developers of transformation and resettlement houses are exempt from stamp tax related to transformation and resettlement houses and the individuals who purchase resettlement houses are exempt from stamp tax.
  The commercial apartments development projects including resettlement apartments can be exempt from urban land use tax and stamp tax in proportion to the percentage of the construction area of transformation and resettlement apartments in total construction area according to the relevant documents issued by government departments and displacement and resettlement compensation agreement.
  If the enterprises, institutions, social organizations and other organizations that transfer their old houses as source of transformation and resettlement apartments and the added values don’t exceed 20% of the amount of deducted items, the relative revenues are exempt from land VAT.
  The operating and managing units who buy back distributed transformation and resettlement houses as source of transformation and resettlement houses again are exempt from contract tax.
  (Notice of Ministry of Finances and State Administration of Taxation on preferential tax policies related to transformation projects of city-owned and state-owned industrial and mineral shantytowns, CS [2010] No.42)
  Article 97 For state-owned industrial and mineral enterprises, state-owned enterprises in forest areas and reclamation areas who participate in the transformation of shantytowns organized by government, their expenses in capital subsidy for transformation of shantytowns compliant with certain conditions are allowed to be deducted before paying corporate income tax.
  (Notice of issues related to policies of deduction of expenses of enterprises for transformation of shantytowns organized by government before corporate income tax, CS [2012] No.12)
  13.4 House rental
  Article 98 The public housing and low-rent housing rented by government at stipulated price, including self-owned housing rented to employees by enterprises and financially independent institutions, public housing rented to residents by departments of housing management and private houses with property right returned when implementing private housing policy and rented to residents according to the rental standard stipulated by government are exempt from house property tax and business tax.
  (Notice of Ministry of Finances and State Administration of Taxation on adjustment of tax policies related to house rental market, CS [2000] No.125)
  14 Other preferential policies
  Article 99 From January 1st of 2013, the cost of production of tax invoices is canceled.
  (Notice of Ministry of Finances and National Development and Reform Commission on publishing canceling and exemption of some administrative and institutional charges, CZ [2012] No.97)
  Article 100 As per provisions of Law of Taxation Management of the People’s Republic of China, the expenses of enterprises which actually occurred in previous years and should be deducted before corporate income tax according to tax regulations but not deducted or not fully deducted can be deducted from the occurring year, but no more than 5 years ago.
  The corporate income tax overpaid by enterprises due to above-mentioned reason can be deducted from the due corporate income tax of the occurring year. Any remaining portion not deducted in that year may be carried forward and deducted in the following tax years or the enterprises can apply for reimbursement of tax accordingly.
  (Announcement of State Administration of Taxation on issues related to tax treatment of taxable income amount for corporate income tax, [2012] No.15)

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