China said on Thursday it will temporarily exempt foreign firms from paying provisional income tax on profits they re-invest into the economy, in a bid to stop foreign firms shifting their operations out of the country.
The move will help “promote growth of foreign investment, improve quality of foreign investment and encourage overseas investors to continuously expand their investment in China,” the finance ministry said on its website.
Analysts say a planned tax cut by U.S. President Donald Trump, which could lead to a repatriation of earnings by U.S. firms, poses a challenge China’s bid to lure foreign investment.
The temporary exemption on provisional income tax is retroactive from Jan. 1 this year, which means firms that have paid taxes this year will be refunded.
But foreign firms must meet several conditions to be eligible for the exemption, the statement said. These include making direct investment into sectors encouraged by Chinese government while investments must be transferred directly to invested companies.
China’s standard corporate tax rate is 25 percent although it gives firms more leeway to make profit deductions when they make charitable donations.
Some Chinese and foreign-funded companies have complained about rising business costs, including high tax burdens.
Press Release from Carey Olsen, Tuesday 21 January, 2025. Carey Olsen has advised Digicel Group Holdings Limited (“DGHL”) on the strategic divestment of its majority shareholding in Cricket
As the South African government works to improve its tax system, a startling revelation has come to light: around 100 000 individuals earning over R1 million annually are not registered for tax. This
In a landmark move, the European Union’s banking watchdog has ramped up its efforts to combat financial crimes in the cryptocurrency sector. The European Banking Authority (EBA) issued new guidelines,
Police in three European countries on Tuesday arrested the masterminds behind an online money-laundering operation suspected of processing up to €2 billion, the continent’s judicial agency said.