Under what circumstances can enterprises enjoy preferential tax rates or other tax breaks?
Foreign investment enterprises in special economic zones or productive foreign investment enterprises founded in economic and technological development zones, can enjoy the enterprise income tax at a reduced rate of 15 per cent.
Productive foreign investment enterprises founded in the coastal economic open areas and in the special economic zones or economic and technological development zones of cities, can enjoy a reduced rate of 24 per cent.
Foreign investment enterprises, which are founded in coastal economic zones, in the special economic zones or economic and technological development zones of cities, or in other regions designated by the State Council, and fall under the categories of energy, communications, harbor, docks or other projects encouraged by the State, can enjoy a preferential rate of 15 per cent.
Concerning the royalties foreign investment enterprises or foreign enterprises receive from the supply of proprietary technologies used in scientific research, energy resources exploration, development of the communications industry, agricultural, forestry and animal husbandry production, and the development of important technologies, the income tax on said royalties may be charged at a reduced rate of 10 per cent or even exempt if the relevant department of the State Council for taxation approves such treatment.
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