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Notification of the State Council on Providing Transitional Preferential Tax Treatments to High-tech Enterprises Newly Set up in Special Economic Zones and in Pudong New District of Shanghai
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| The people\'s governments of all provinces, autonomous regions, municipalities directly under the Central Government, all ministries and commissions of the State Council, and all organs directly under the State Council, According to Article 57 of the Enterprise Income Tax Law of the People\'s Republic of China, the State Council determines to provide transitional preferential tax treatments to the high-tech enterprises under the powerful support of the state, which were set up in the special zones set up by law for advancing foreign economic cooperation and technological communication and in the area where the State Council has offered to carry out the abovementioned special policy. The following issues are notified: 1. The expression \"special zones set up by law for advancing foreign economic cooperation and technological communication\" means Shenzhen, Zhuhai, Shanou, Xiamen and Hainan Special Economic Zones. The expression \"the area where the State Council has provided for the implementation of the abovementioned special policy\" means Pudong New District of Shanghai. 2. For a high-tech enterprise under the key support of the state in a special economic zone or in Pudong New District of Shanghai that completes the registration on or after January 1, 2008 (hereinafter referred to as the high-tech enterprise), the incomes acquired by it in the special economic zone and in Pudong New District of Shanghai shall be relieved from the enterprise income tax (hereinafter referred to as the EIT) for the first 2 years as of the tax year to which the first revenue coming from production or operation contributes , and shall be levied at half of the statutory tax rate of 25% for the third to the fifth years. The expression \"high-tech enterprises under the powerful support of the State\" means the high-tech enterprises which have their own kernel independent intellectual property rights and meanwhile meet the conditions as referred to, in Article 93 of the Regulation on Carrying out of the Enterprise Income Tax Law of the People\'s Republic of China and have been realized in pursuance of the Measures for the Determination of High-tech Enterprises. 3. In case a high-tech enterprise newly set up in a special economic zone or in Pudong New District of Shanghai embarks upon production and operation in other areas aside from the special economic zone or Pudong New District of Shanghai at the same time, it shall separately calculate the incomes it acquires in the special economic zone or Pudong New District of Shanghai and rationally divide the expenses incurred during the corresponding period. In case it cannot calculates independently, it shall not enjoy the preferential treatments regarding enterprise income tax. 4. In case a high-tech enterprise newly set up in a special economic zone or in Pudong New District of Shanghai no longer has the high-tech enterprise qualification because of review or because of its failure to pass a spot-check during the period when it enjoys the transitional preferential tax treatments stated in this Notification, once it dose not have the high-tech enterprise qualification, it shall have no chance to enjoy the transitional preferential tax treatments from the tax year Where it is once again approved as a high-tech enterprise later, it shall not continue to or re-enjoy the transitional preferential tax treatments. 5. This Notification shall enter into force as of January 1, 2008. The State Council December 26, 2007 |
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