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Business-friendly measures extended

By Wang Ying in Shanghai | China Daily | Updated: 2017-04-01 07:55

From April 1, the Shanghai government will launch a new series of policies to ease enterprises' financial burden.

The measures are expected to save companies more than 40 billion yuan ($5.8 billion), said Shanghai's vice-mayor on Friday.

Briefing media, Zhou Bo said tax cuts, lower administrative charges, cheaper gas and power for use by companies, and streamlined administration are designed to make life easier for businesses.

The measures are in line with the nation's promotion of supply-side structural reforms and acceleration of innovation-driven development.

The municipal government has been lowering corporate taxes and fees over the last few years.

"In 2016, local companies received similar benefits to the extent of 50 billion yuan, in the form of tax waiver, cut in administrative fee, lower payment toward social security and housing funds, and reduction in institutional transaction cost and energy cost," said Zhou.

He said the municipal government of Shanghai has decided to extend the benefits this year as well.

More small and micro enterprises will likely enjoy the benefit of income tax exemption if their annual income is within 500,000 yuan. The previous limit was 300,000 yuan.

"Nearly 240,000 small and micro enterprises benefited from preferential taxes last year. Their total tax cuts reached 1.4 billion yuan," said Hu Lanfang, an official of Shanghai's local tax bureau.

Small and medium-sized high-tech enterprises can enjoy even higher tax cuts. As much as 75 percent of their research and development spending will be taken into consideration while computing their payable tax. The corresponding figure for last year was 50 percent, which benefited nearly 3,000 companies, she said.

"Shanghai will continue to promote the replacement of business tax with a value-added tax, especially in four key industries, for this year's trial. The four industries are construction, real estate, finance and services," said Zhou.

Shanghai is among the Chinese cities that replaced business tax with a value-added tax earlier than others.

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