ANNOUNCED AS TEMPORARYYes
Tax or social insurance relief
On the 20th of April 2012, two Chinese ministries* jointly announced a policy granting corporate tax breaks to companies producing integrated circuits (ICs).
Two tiers of tax leniency were announced。
Firstly, any companies producing ICs with a circuit gauge of ≤0.8μm can apply for complete exemption from the tax for their first two years. For the third to fifth year, a half rate of 12.5% would be levied.
Secondly, for companies producing ICs with a circuit gauge of ≤0.25μm or whose investment amount is more than USD 1.27bn (CNY 8bn) who have been operating profitably for 15 years or more, a second scheme is available where the tax will be exempted for the first five years of profit-making, then at the full 25% for the sixth to tenth years, then at 15% for any remaining years up to 2017.
To be eligible, the firm in question must have been established before December 31st, 2017.
UPDATE: In 2018, the policy was updated - please see related act for more information.
*Chinese Ministry of Finance (MOF) and State Administration of Taxation (SAT).
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