China’s Latest Administrative Fee Cuts for Companies
China will introduce new administrative fee cuts including lowering industrial electricity costs by 5% and reducing the average telecommunications rates by 15% to help enterprises – particularly small and medium-sized enterprises, or those in manufacturing and common services industries. Companies are expected to save around RMB 310 billion (US$44 billion) over the course of this year.
Corporate Income Tax Cut for Foreign Companies Investing in Western China
In an effort to encourage further foreign investment into its western regions, China is reducing the standard enterprise income tax rate of 25% to 15% for foreign companies willing to locate there. The tax relief policy will last three years.
The Ministry of Finance, the State Tax Administration and National Development and Reform Commission have jointly issued a circular regarding the preferential tax policy, which will apply in the provinces of Sichuan, Guizhou, Yunnan, Shaanxi, Gansu, Qinghai, Chongqing, as well as the autonomous regions of Inner Mongolia, Guangxi, Tibet, Ningxia Hui and Xinjiang.
The reduced rate will be effective from beginning of January 2021 to the end of December 2023.
Employer Social Security Contributions Cut till end of 2020
On 22 June 2020, the Ministry of Human Resources and State Administration of Taxation jointly issued Circular no. 49, according to which small and medium scale enterprises are exempted from the payment of employees’ pension fund, work-related injury fund and unemployment fund. Additionally, the employer’s contribution part from February to June 2020 is now extended to December 2020.
China Extends VAT Preferential Policy for Small Scale Taxpayers to end of 2020
On 7 May 2020, China’s State Taxation Administration (STA) and Ministry of Finance (MOF) announced an extension to the preferential value-added tax (VAT) policy for small-scale taxpayers. From 31 May 2020 to the end of the year taxpayers can continue to enjoy VAT reduction from 3% to 1%.
PBOC Lowers Lending Rates Again
As a result of the economic impact of the Covid-19 pandemic, China’s central bank, the People’s Bank of China, has decided to further lower the Lending Prime Rate (LPR) beginning on 20th April 2020. The new rate is 3.85% for 1-year LPR and 4.65% for LPR over 5 years. This is the second decrease in 2020 following the previous one announced on 20th January.
Official National Holidays 2020
China’s General Office of the State Council has released the “Notification of Holiday Arrangements in 2020” which lays out the official national holiday schedule for 2020 as follows:
||Official Working days
|Qing Ming – Tomb Sweeping Festival
||April 4 – 6
|May Labour Day
||May 1 – 5
||April 26 (Sunday) and May 9 (Saturday)
|Dragon Boat Festival
||June 25 – 27
||June 28 (Sunday)
|October National Day
||October 1 – 8
||September 27 (Sunday) and October 10 (Saturday)
“Two Certificates in One” System
China’s Ministry of Commerce, General Administration of Customs and Council for the Promotion of International Trade have jointly issued a notice (no. 39) announcing that the foreign trade operators filing and enterprises of origin filing will be included into the “two certificates in one” system nationwide from October 15.
After the implementation of the “two certificates in one”, exporters can directly obtain the filing qualification of enterprises of origin after completing the registration of foreign trade operators, which means they can complete the filing at one time. Enterprises do not need to re-enter information and upload materials a second time, which will simplify the procedures, save cost and improve the efficiency.
Shanghai Launches Single Window Service for Foreign Permits
On 2nd December 2019 Shanghai Administration of Foreign Experts Affairs and Shanghai Science and Technology Commission of Shanghai Municipal Public Security Bureau (Municipal Foreign Experts Bureau) launched a new “single window” service for foreigners holding the category A work and residence permit. The single window is located in the foreigner certificate centre on the third floor of the Exit-Entry Administration Department of Shanghai Municipal Public Security Bureau at 1500 Minsheng Road, Pudong District, Shanghai.
After the approval by Shanghai Administration of Foreign Experts Affairs and the Exit and Entry Administration Bureau of Shanghai Municipal Public Security Bureau, foreigner applicants (Category A) can obtain work and residence permit in one place at the same time.
China Lowers Import Tariffs
Starting from 1st January 2020 China has reduced import tariffs on several categories of goods to boost trade.
Consumer goods, agricultural products, pharmaceuticals, semiconductor components and automobiles have all seen tariffs adjusted. Adjustments to food products include a cut in import duties on frozen pork from 12% to 8%, frozen fish from 7% to 2% and frozen orange juice from 30% to 15%. Duties on medicines for pharmaceutical products containing alkaloids for asthma treatment and raw materials for the production of new diabetes medicines have been eliminated.
Texts and Data to be Valid Evidence in China Supreme People’s Court
According to the notice of the Supreme People’s Court published on 26 December, electronic data on China’s popular WeChat and Weibo platforms can be used as evidence in the future. Electronic data includes:
· Messages posted on web pages, blogs, Weibo and other network platforms;
· Communication information of mobile phone SMS, e-mail, instant messaging, communication groups and other network application services;
· User registration information, identity authentication information, electronic trading records, communication records, login logs and other information;
· Documents, pictures, audio, video, digital certificates, computer program & other electronic documents;
· Other information stored, processed and transmitted in digital form that can prove the facts of the case.
The law is set to take effect on 1st May 2020.