March 2024 / China

Guangdong Provincial People's Government released the Guidelines on Promoting the In-depth Integration of Technology and Finance to Boost the Innovation-driven Development of Technology-based Enterprises, which provide guidelines in 15 aspects.

The document stresses the need to attract venture capital companies to develop in Guangdong. To this end, it specifies measures including strengthening the publicity and practical guidance of preferential tax policies for venture capital, taking the lead to implement differentiated tax rates and other preferential tax policies to encourage long-term investments from venture capital companies in Guangdong, facilitating cross-border investment and financing in the field of science and technology, and creating a fast lane for the examination and approval of the foreign investments in venture capital companies in Guangdong and high-tech projects that meet the requirements of the national Catalogue of Industries for Encouraged Foreign Investment through qualified foreign limited partners (QFLP).

The Shanghai Municipal Administration for Market Regulation, the Shanghai Municipal Tax Service, State Taxation Administration and other three authorities in Shanghai recently released the Guidelines on Comprehensively Deepening the Reform to Facilitate Exit of Businesses, which has taken effect and will remain valid until February 17, 2024.

The document clarifies that a simplified deregistration system would apply to all types of businesses and farmers' professional cooperatives except for listed joint-stock companies. For individual businesses deregistered in a simplified manner, there would be no need to make an announcement on the deregistration, and the registration authorities would push the application to the tax authorities. The document also simplifies the procedures and required materials for the deregistration of bankrupted enterprises, exempting them from submission of tax clearance certificates and making the announcement of the deregistration. The document also stresses the need to implement the reform of electronic deregistration for the whole process, urging to add App services related to digital signatures, delivery and return of business licenses and others, and explore to allow cancellation of business licenses and deregistration of tax affairs simultaneously.

The Supreme People's Court (SPC), the Supreme People's Procuratorate (SPP), the Ministry of Public Security, and the State Taxation Administration jointly held on March 18, 2024 a press conference and released the Interpretation of the Supreme People's Court and the Supreme People's Procuratorate on Several Issues Concerning the Application of Law in Handling Criminal Cases of Endangerment to Tax Collection and Management.

Consisting of a total of 22 articles, the Interpretation sets forth provisions on the circumstances for the conviction and sentencing of 14 crimes that endanger tax collection and management laid down in the specific provisions of the Criminal Law, specifying the conviction and sentencing criteria for various types of invoice-related crimes such as forging, illegal sale, purchase, and false issuance of invoices, and making appropriate adjustment to the conviction and sentencing criteria for the three crimes stipulated in the original tax-related judicial interpretations. The Interpretation imposes specific regulation on the signing of "dual contracts" as one means of tax evasion, lists eight forms of "false export reporting", and clarifies lenient penalties policies relating to supplementary tax payments and recovery of tax losses. In addition, the Interpretation also specifies that the conviction and sentencing criteria for entities committing crimes that endanger tax collection and management shall be implemented in accordance with the criteria for natural persons who commit such crimes, which improves the administrative-criminal connectivity mechanism against crimes that endanger taxation. Additionally, the Interpretation makes provisions on the determination of joint crimes that endanger taxation.

In accordance with the Implementation Measures for the Pilot Reform of Business Tax to VAT (2016) and the Notice on VAT Policies such as the Deduction of Input Tax on Leased Fixed Assets, Where a taxpayer purchases fixed assets, intangible assets (excluding other equity intangible assets), immovable property, or leased fixed assets, immovable property, both for the general method of tax calculation, but also for the simple method of tax calculation, VAT exemption items, collective welfare or personal consumption, the input VAT is allowed to be fully deducted from the output VAT.

The input VAT allowed to be fully deducted by the above policies and regulations refers to the input VAT obtained from the purchase of fixed assets, intangible assets (excluding other equity intangible assets), real estate, leased fixed assets and real estate, excluding the input VAT corresponding to various expenses paid after the purchase or rental of related assets, such as renovation fees, heating fees, property fees, maintenance fees and other expenses.

The Chinese government released on March 7, 2024 the Guidelines of the State Council on Further Improving Payment Services to Make Payment Easier, which highlight six key tasks.

The tasks include expanding the acceptance rate of bank card payments to meet the demands of the elderly and foreigners who use bank cards in various scenarios, continuously insisting on the usage of cash and improving the environment for the use of cash, further enhancing the convenience of mobile payment services and encouraging banks and payment institutions to work with clearing houses and upgrade their services for the convenience of seniors and overseas visitors, ensuring that consumers have the right to choose their preferred payment method, requiring large business districts, tourist attractions and other key locations to support mobile, bank card and cash payments, streamlining account-opening services, and promoting various payment services.

The Chinese government published on March 14, 2024 the Action Plan on Promoting Large-scale Equipment Renewal and Trade-in of Consumer Goods, as issued by the State Council, calling for providing more policy support in terms of finance, tax and investment.

The plan stresses four major tasks, including equipment renewal, trading-in of consumer goods, recycling of used goods, and standard leveling-up, with the relevant work arrangements specified. In terms of policy support, it urges to improve the tax policies to support energy and water conservation, environment protection, safe production of dedicated equipment, as well as digital and intelligent transformation. It also proposes to promote the practice of "reversely issuing invoices" to natural-person sellers of scrapped products by resource recycling firms by applying a simplified VAT levying policy on the firms, improving the supporting measures for the collection of income tax and optimizing tax collection and management standards and methods.

Il governo cinese ha pubblicato la Circolare del Consiglio di Stato sull'emanazione del Piano d'azione con misure di sostegno politico per rendere il Paese più attraente per gli investimenti stranieri.

Tra le iniziative previste dal piano, vi è la possibilità per le imprese stabilite in Cina, con reinvestimenti da parte di imprese a partecipazione straniera, di essere esentate dai dazi per l'importazione di attrezzature per uso proprio se soddisfano le condizioni specificate nel Catalogo delle industrie incoraggiate per gli investimenti stranieri.

Il governo si impegna ad attuare politiche di sgravio fiscale per gli investitori stranieri che investono nel mercato obbligazionario cinese e in altri mercati finanziari e ad ampliare il Catalogo delle industrie incoraggiate per gli investimenti stranieri e l'elenco dei progetti chiave finanziati dall'estero.

Per quanto riguarda il Catalogo delle industrie incoraggiate per gli investimenti esteri, il Paese aumenterà il sostegno alla produzione avanzata, all'alta tecnologia, alla conservazione dell'energia e alla protezione dell'ambiente.

Per quanto riguarda il Catalogo delle industrie prioritarie per gli investimenti stranieri nella Cina centrale e occidentale, sarà fornito un maggiore sostegno alla produzione di base, alle tecnologie applicabili e ad altri settori.

Il Paese sosterrà inoltre l'inclusione di progetti finanziati dall'estero nei settori dei circuiti integrati, della biomedicina e delle attrezzature di alto livello nell'elenco dei progetti chiave finanziati dall'estero per l'accesso al mercato interno.