China widens income tax exemption for foreign investors

China widens income tax exemption for foreign investors

A worker climbs on steel bars at a construction site of a subway in Chengdu, Sichuan province, China, on Aug 14. (Reuters photo)
A worker climbs on steel bars at a construction site of a subway in Chengdu, Sichuan province, China, on Aug 14. (Reuters photo)

BEIJING: China has widened income tax exemption on re-invested profits for foreign firms, the Finance Ministry said on Sunday, to try to boost foreign investment amid trade tensions.

The ministry said last December it would temporarily exempt foreign firms from paying provisional income tax on profits they re-invest in the country. But such policies only covered investment into sectors encouraged by the Chinese government.

The scope of the tax exemption has been expanded to all sectors where foreign investment is not prohibited, the ministry said in a statement.

The move will help "further encourage foreign investment in China", the finance ministry said on its website.

The tax exemption expansion is retroactive from Jan 1 this year, which means firms that have paid taxes this year will be refunded.

China's standard corporate tax rate is 25% although it gives firms more leeway to make profit deductions when they make charitable donations.

The government has taken steps to attract foreign investment, as part of policy steps to support the slowing economy amid rising trade tensions with the United States.


Do you like the content of this article?
COMMENT (4)

Giant killers

Thailand shocks powerful Dominican Republic to close out first round of world women's volleyball championship with four wins and just one loss.

1 Oct 2022

‘Phenomenal’ Arsenal sink 10-man Spurs

LONDON: Mikel Arteta insisted Arsenal proved their credentials as genuine Premier League title contenders with an impressive 3-1 win over 10-man Tottenham in Saturday’s north London derby.

1 Oct 2022

Business chiefs unite for green future

The CEOs of five of Thailand’s leading businesses have stressed the need for companies of all sizes to contribute more to environmental protection, saying it is now the norm in development and sustainability practice.

1 Oct 2022