(Yicai Global) April 26 -- The State Council, China’s cabinet, has introduced seven new tax reduction measures, which are expected to cut more than CNY60 billion (USD9.5 billion) worth of tax burden over enterprises per year. New measures aim to promote preferential policies to reduce the cost of enterprise innovation and support the development of high-tech enterprises.
China’s Premier Li Keqiang introduced the new measures, which increase the tax deduction limit for research and development equipment purchased by enterprises from CNY1 million to CNY5 million per year, extend the loss carry-forward period for high-tech companies and technology-based small- and medium-sized enterprises to 10 years from five years, and remove restrictions over the R&D expenses by enterprises’ entrusting overseas agencies not being applicable to tax deduction.
The measures aim to encourage enterprises for further R&D and independent innovations and to advance their technological level, said, National Business Daily reported today.
China’s cabinet also introduced tax reduction policies late last month. The measures announced on march 28 reduced the value-added tax rate to 16 percent from 17 percent for manufacturing and cut the tax rate from 11 percent to 10 percent for transportation, construction and telecommunications services as well as agricultural products. The measures are expected to reduce the tax burden over companies by more than CNY400 billion annually.
Editor: Mevlut Katik