Beijing announces tax cuts for 400 billion yuan
It is the first reduction since 1994, when the VAT system was launched. Taxes will be reduced from 17% to 16% in the manufacturing sector; in the transport, construction, telecommunications and agricultural sectors, they will be lowered from 11% to 10%. All these measures will be applied to Chinese and foreign companies.
Beijing (AsiaNews) - China has announced a reduction in value added tax for some sectors of the economy, equivalent to a saving of 400 billion yuan (about 53 billion euros).
The tax cut, which will be effective from May 1, is the first since 1994, when the country adopted the tax reform and assumed the so-called VAT system.
Taxes will be reduced from 17% to 16% in the manufacturing sector; in the transport, construction, telecommunications and agricultural sectors, they will be lowered from 11% to 10%.
All these measures were decided in a meeting of the Council of State, held yesterday and chaired by Premier Li Keqiang.
Another decision is the reduction of fees for small businesses. So far, those companies that had sales of up to 800 thousand yuan were eligible for the reduction. Now the basis for requesting a tax reduction is 5million yuan.
All these measures will be applied to Chinese and foreign companies.
According to some researchers, the 1% reduction in VAT is too low to bring real benefits to small and medium-sized businesses.
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