China has been fostering a market- and law-based and global-level tax and business environment to stabilize market confidence in recent years, in a way of more taxes and fees cut and tax proceeding reform. Since early year, China has extended and optimized some phased tax and fee preferential policies. In the first four months, the tax and fee cut and tax refunds nationwide are accumulated up to 468.9billion yuan, according to the State Taxation Administration.
These preferential policy service have been publicized 209 million times to targeting enterprises this year, including the tax and fee cuts to 18.92 million large and medium-sized enterprises, and specialized-and-sophisticated enterprises that produce new and unique products, said Mr. Shen Xinguo, director of Taxpayer Service Department of the State Taxation Administration on June 14.
Besides, it is more convenient to handle tax-related matters in China. Over the last decade, 620 measures and policies have been issued to taxpayers, along with the “Spring Breeze Action of Tax Administration”. These reforms are crucial to a better tax business environment.
In Zhejiang, a cluster of small and medium-sized enterprises, the tax authorities provided services categorized for enterprises in various phases. Preferential policies on the tax administration have been employed to the innovation platforms and investment firms for business startups, thus enhancing the development of the innovative entities. 19 high-end R&D institutions and thousands of high-end projects such as Hangzhou VR/AR Innovation Institution of Beihang University have settled in China AI town located in Hangzhou Chengxi Sci-tech Innovation Corridor. These town-based enterprises have obtained 2,038 invention patents, utility model patents and others.
In Guangdong, a major foreign trade region of China, the tax authorities conducted a questionnaire survey on 509 exporting enterprises out of 43 industries. The survey found their difficulties in “orders on hand”, export expectations, raw material prices, labor costs, freight costs, investment and so on. The tax authorities have streamlined the proceed of export tax rebates in response to the financial pressure on many enterprises for less “orders on hand”.
In Yunnan, neighbor to the Southeast Asia, the local tax authorities have composes and updated Tax Guidelines for Chinese Residents on Investment in four neighbor countries, including Laos and Myanmar, In order to support Chinese enterprises to go global, they has produced brochures of tax policies in Chinese-Laos and Chinese-Myanmar editions, and various cartoons in Chinese, English and Laos. Jiang Yun, vice chairman of Kunming Klim Light Industry Machinery Co., LTD., a sugar equipment manufacturer, said his company quickly establish an overseas production base in Thailand due to the support and policy guidance of the Chinese and Thai governments.
The law-based governance is important to build a better business environment. Draft tariff law is to be submitted to the Standing Committee of the National People's Congress (NPC) for deliberation, and draft consumption tax law and the revised draft tax collection and management law were proposed for the deliberation of the Standing Committee of the NPC, according to recently published State Council 2023 Annual Legislative Agenda. Mr. Li Ping, deputy director of the Institute of Tax Science of the State Administration of Taxation, said that 12 of the 18 taxes have been passed legislation in recent years, and many other tax laws will be proposed for deliberation or pre-deliberation this year, marking a faster process of the tax legislation.
