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China Updates Tax Incentive Guidelines for Entrepreneurs

A revised version of the Guidelines on Tax Incentives for Mass Entrepreneurship and Innovation has been issued by the State Administration of Taxation. Released to coincide with last month’s National Entrepreneurship and Innovation Week, the new edition incorporates the 89 preferential policies for entrepreneurship and innovation introduced since the Guidelines were originally produced in April 2017.

Among the key additions to this revised edition are the following:

  • The previous threshold for a 50% reduction in enterprise income tax for small low-profit enterprises has been raised from RMB300,000 in annual taxable income to a maximum of RMB3 million. The VAT threshold has also been raised, increasing from RMB30,000 of monthly sales to RMB100,000.
  • The eligibility for VAT, property tax and urban land use tax exemption has been broadened from high-tech business incubators and university science parks to include provincial-level incubators, university science parks and all duly-registered makerspaces. The individual income tax policy previously only applying to venture companies and angel investors has also been extended and now applies on a national basis.

Source: State Administration of Taxation

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