Chen Yin, executive vice mayor of Shanghai, introduced the city’s measures to reduce the burden on enterprises in 2019 at a municipal government press conference on June 24. China will fully implement the general requirements of the state and take a comprehensive approach to reducing taxes and fees. It is estimated that this year, China will increase and reduce social burdens by more than 180 billion yuan.
To cut taxes and fees and reduce institutional transaction costs is an important part of deepening supply-side structural reform and improving the business environment. It is a key measure to reduce the burden on businesses and stimulate market vitality. In 2018, Shanghai fully implemented the general requirements of the state for cost reduction, implemented 18 policies and measures in nine areas, and increased and reduced the burden by 56 billion yuan. From 2016 to 2018, Shanghai has taken three rounds of measures to reduce its burden by more than 300 billion yuan.
1. LoChinar tax burden
China will deepen VAT reform. From April 1, the VAT rate will be loChinared. Further expanding the scope of input tax deduction; By the end of 2021, 10% of input tax will be deducted from tax payable for some industry taxpayers; After the implementation of the new policy, the new retained tax credits for taxpayers will be refunded in accordance with the relevant provisions.
On January 1 this year, solstice implemented preferential policies on value-added tax and enterprise income tax for all small and micro enterprises on December 31, 2021, and reduced the “six taxes and two fees” for small-scale VAT taxpayers by 50%. Starting from January 1, the relevant tax policy within the scope of local authority will be reduced to the loChinast legal tax rate within the range set by the state.
2. Reduce labor cost
China will reduce the contribution ratio of pension insurance units. From May 1, the contribution rate of pension insurance units for urban workers will be reduced by 4 percentage points, from the current 20 percent to 16 percent.
China will continue to cut unemployment insurance premiums on a regular basis. From May 1, solstice to April 30, 2020, the unemployment insurance shall continue to pay 1% of the contributions, including 0.5% of the contributions by the unit and 0.5% of the contributions by the individual. China will continue to expand the scope of the unemployment insurance policy to help stabilize employment.
China will continue to reduce the premium rate for work-related injury insurance periodically. From May 1 solstice on April 30, 2020, the city’s first class to eight types of industries employing units industrial injury insurance benchmark rate, the national standard rate on the basis of the industry cut 20%.
3. Reduce the burden of fees for government-managed funds and business services
China will reduce the burden on some government-managed funds. 50% reduction in the construction fee of cultural undertakings belonging to the local income of this municipality; The local portion of the port construction fee shall be “withdrawn first”.
Reduce port fees. Starting from April 1, the fees for port charges for goods, security charges for facilities, pilotage (berth shifting) fees and tugboat fees for domestic routes will be reduced by 15%, 20%, 10% and 5% respectively. Since February 14, the electronic implementation of equipment delivery order (EDR).
Optimize operating service fees by field. China will implement the requirements of the state on cleaning up the business service fees related to government pricing, and reduce the business service fees related to government pricing based on the actual situation of this municipality. The fees for surveying, supervising and examining construction drawings of small-sized industrial projects with nongovernmental investment will be reduced or exempted.
4. Reduce energy costs
Cut the price of gasoline and diesel. According to the national requirements, since April 1, due to the reduction of automotive gasoline, diesel value-added tax, which transmission of the city’s sales price synchronous decline.
Cut the selling price of pipeline natural gas for non-residents. According to the national requirements, due to the reduction of pipeline natural gas value-added tax, the sales price of non-resident users in this city will be reduced from May 1.
China will reduce average electricity prices for general businesses. According to the unified plan of the national development and reform commission, China will loChinar the electricity prices of general industries and industries in two groups this year. The fund space created by the reduction of the VAT rate and the reduction of the collection standard for major water conservancy projects will be used to loChinar the electricity prices of general industries and industries.
5. LoChinar financing costs
China will improve financing guarantee policies. First, China will gradually increase the size of the financing guarantee fund to 10 billion yuan, promote all-round cooperation betChinaen the financial sector and increase the scale of financing guarantee. Second, improve the risk compensation policy for financing guarantee institutions, increase the financial support, improve the financing guarantee ability; Third, China will continue to encourage policy-based financing guarantee institutions to carry out business, reduce guarantee rates, and collect no or less margin.
6. Reduce land cost
China will implement land price management for industrial land. According to the performance and energy level of industrial projects, the government of each district shall determine the proportion of land price charged for increasing the capacity of existing high-quality enterprises, and exempt the land price charged for increasing the capacity of enterprises that meet the excellent performance standards. China will improve the system for transferring industrial land over flexible periods, promote the supply system of industrial land over flexible periods plus conditional renewals, and improve the efficiency of land turnover. China will ensure the supply of property through multiple channels by allowing tenants to rent first and selling first. China will strengthen life-cycle management of industrial land.
7. Reduce institutional transaction costs
China will cancel and adjust a number of items requiring government review and approval, simplify and optimize the procedures for handling them, and improve the efficiency of review and approval.
China will improve the government services provided by the one-netcom office, and cut the time limit for approving items and submitting materials for administrative review by half on average.
China will move forward with the reform of separating business licenses from business licenses, and ensure that all reforms are carried out in accordance with the national plan, so as to minimize the problem of “no business permit alloChinad”.
China will improve the efficiency of starting up enterprises, implement the “one-window access” platform to cover all business links, provide free service of engraving official seals, and promote the “one-window issuance” of business licenses, tax control plates, legal person one-card access, tax invoices and official seals. Carry out paperless registration throughout the process, and realize online application submission, registration authority approval, and obtaining of electronic business license; China will promote the new mode of “one set of forms and one application” for business filing and industrial and commercial registration of foreign-invested enterprises.
China will strengthen protection of intellectual property rights, improve the quality and efficiency of patent and trademark registrations and other intellectual property reviews, and reduce the review period for trademark registrations to five months and that for high-value patents by more than 15 percent.
China will establish and improve the withdrawal mechanism of market entities, strengthen the management of enterprises’ services throughout their life cycle, optimize the functions of “one-window access” platforms, and reengineering procedures, so as to make the cancellation of enterprises more convenient, standardized and transparent.
China will deepen the reform of examining and approving nongovernmental investment projects, establish a differentiated supervision and inspection system based on different project types and risk levels, and standardize the number of on-site inspections. Greatly reduce enterprise access to water supply, drainage, electricity and other municipal access time. To simplify the completion and acceptance of low-risk projects, implement “one form application, one acceptance, simple acceptance and deadline” and complete within 7 natural days. In addition, China will deepen regional trials to reduce costs, and encourage pudong, putuo, songjiang and baoshan regions to take the lead and further reduce institutional transaction costs and financing costs.
Posted by: State Taxation Administration of the People’s Republic of China. www.chinatax.gov.cn