The Chinese government is launching a raft of new tax incentives that are designed to support the overseas expansion of domestic enterprises and increase their international competitiveness.
At a press briefing held on 27 February Liu Baozhu (刘宝柱), vice-head of the State Administration of Taxation’s (SAT) Income Tax Office, said that the Ministry of Finance and SAT had just jointly issued the “Notice Concerning Improvements to Issues with Policies for the Deduction of Income Tax Paid Abroad” (关于完善企业境外所得税收抵免政策问题的通知), which adjusted policy in two key areas.
The first is an expansion in integrated income tax deductions methods, with enterprises given the right to independent selection, while the second is an increase in the number of overseas share revenue indirect deduction tiers to five from three previously.
Huang Suhua (黄素华), vice-head of SAT’s International Taxation Office, said that the new taxation policies were designed to support the overseas expansion and foreign investment of Chinese enterprises.
“In order to better service the nation’s foreign openness strategy and provide tax collection services to Chinese enterprises that go abroad, as well as help enterprises to avoid offshore investment tax collection risk, SAT has recently issued numerous public announcements that clarify a number of international tax levying regulatory items,” said Huang.