The Ministry of Finance and the State Taxation Administration released on December 9, 2020 the Announcement about Pretax Deduction of Advertising and Business Publicity Expenses, to be effective from January 1, 2021 until December 31, 2025. The previous edition of the announcement issued in 2017 will be revoked from January 1, 2021.
According to the announcement, advertising and business publicity expenses at cosmetics production or sale companies, pharmaceutical & beverage companies (Excluding alcoholic firms) are tax-deductible if the expenses do not exceed 30% of the sales or operating revenue for the current year; expenses in excess of the figure can be carried over and tax-deductible in the following years. Tobacco advertising expenses and business publicity expenses incurred by tobacco companies are not eligible for tax deductions.