Tax break widened to more small busi­nesses

China Daily (Canada) - - FRONT PAGE -

re­duc­tion of their busi­ness in­come tax, ac­cord­ing to a state­ment re­leased af­ter the meet­ing, which was presided over by Pre­mier Li Ke­qiang.

The mea­sure will be ef­fec­tive fromJan1of this year to theend of2017. Dur­ing the­samepe­riod, th­ese com­pa­nies could also pay the tax at a rate of 20 per­cent, five points lower than other en­ter­prises, it said.

El­i­gi­bil­ity for the 50-per­cent re­duc­tion has been ex­panded sev­eral times since 2012. The orig­i­nal thresh­old was a busi­ness in­come be­low 30,000 yuan, but that was amended to the cur­rent 100,000 yuan. The new thresh­old will be 200,000 yuan. Ac­cord­ing to the State Ad­min­is­tra­tion of Tax­a­tion, tax breaks­fors­mal­land­mi­crobusi­nesses in China to­taled 61.2 bil­lion yuan last year. Busi­ness incometaxes of 10.1 bil­lionyuan were re­duced or scrapped for 2.46 mil­lion small and mi­cro busi­nesses.

Wang Yuanzhi, deputy sec­re­tary-gen­eral of the China As­so­ci­a­tion of Small and Medium En­ter­prises, said the de­ci­sion will help com­pa­nies by re­liev­ing their tax bur­den fur­ther. “It shows the gov­ern­ment’s in­creas­ing sup­port for th­ese com­pa­nies,” Wang said, adding that the re­duc­tion of taxes and fees is a nec­es­sary mea­sure to en­sure sta­ble devel­op­ment of small, low­profit com­pa­nies.

Small and mi­cro busi­nesses are a key driv­ing force of in­no­va­tion and em­ploy­ment, Wang said. As their prod­ucts and ser­vices are closely re­lated to peo­ple’s liveli­hoods, they play a cru­cial role in main­tain­ing China’s steady eco­nomic growth.

Of­fi­cials at the meet­ing also low­ered the rate for un­em­ploy­ment in­sur­ance fees from the cur­rent 3 per­cent to 2 per­cent, a mea­sure that is pro­jected to save more than 40 bil­lion yuan for en­ter­prises and em­ploy­ees.

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