PR99046

GUANGZHOU, China, Nov. 30, 2022 /Xinhua=KYODO JBN/--

Recently, Guangzhou released the Measures of Preferential Individual Income Tax

Policy in Nansha District of Guangzhou Municipality. The document clarifies the

implementation details. Under these measures, for Hong Kong and Macao residents

working in Nansha, the IIT burden exceeding that in the two special

administrative regions (SARs) will be exempted.

This tax policy was launched in accordance with the tax system of the Chinese

mainland to promote the alignment of tax rules between Guangzhou and the two

SARs. It will help create a favorable business and living environment in Nansha

where the IIT policies align with those of Hong Kong and Macao and facilitate

Hong Kong and Macao residents in the establishment of their own businesses or

simply gaining employment in Nansha. The associated benefits generated in the

development of the Greater Bay Area will be shared by more Hong Kong and Macao

residents, according to Nansha District People's Government of Guangzhou City.

Nansha sits at the geometric center of the Guangdong-Hong Kong-Macao Greater

Bay Area and serves as a vital hub for the area's interconnection. On June 14

of this year, China's State Council issued an overall plan to promote

comprehensive cooperation among Guangdong, Hong Kong and Macao by further

deepening opening-up in Nansha, thus giving Nansha a new positional objective

and a major mission.

Zhaoke Ophthalmology, a biomedical company founded in Nansha, had only one Hong

Kong executive based in Nansha before the Plan of Guangzhou Nansha was

implemented. Given that Hong Kong residents who work in Nansha can now enjoy

tax rebates in line with the Hong Kong tax system, more overseas executives are

forecast to be based in Nansha. "As our Hong Kong team boasts advantages in the

R&D and introduction of biomedical technology, this tax policy will help

attract more talent with an international vision for our company," said its

board chairman, Dr. Li Xiaoyi.

This is not the first tax preferential policy after the release of the Plan of

Guangzhou Nansha. Recently, Guangdong Province officials forwarded the Notice

of the Ministry of Finance and the State Taxation Administration on

Preferential Policies on Corporate Income Tax in Guangzhou Nansha for the

benefit of key businesses and industries, and they advanced their opinions on

its implementation. This marked the official implementation of the corporate

income tax (CIT) incentive in Nansha.

Targeting key businesses and industries, this tax preferential policy features

two highlights. First, in Nansha's launch areas, qualified businesses in the

encouraged industries may enjoy a reduced corporate income tax rate of 15%.

Second, starting from January 1, 2022, high-tech companies or small- and

medium-sized tech firms in Nansha are allowed to extend their carry-over of

losses for up to 13 years. Such losses refer to those incurred within eight

years before they become qualified for this policy.

As a Hong Kong-invested company that has been in Nansha for over ten years,

Zhaoke Ophthalmology is committed to the R&D and manufacture of biomedical

products. Compared with only 30-odd employees upon its establishment in 2018,

the company now has a strong workforce of more than 300 people, over half of

whom are R&D staff.

Regarding this tax incentive, Dr. Li Xiaoyi said that under the guidance of

these new policies, Chinese businesses will gradually reduce their reliance on

foreign technologies and focus more on independent technology R&D.

These two tax policies were issued successively. So far, all tax preferences

under the Master Plan of Guangzhou Nansha have rapidly been refined and

implemented.

Nansha's tax policies will continue to enhance the willingness of market

entities to participate in the district's development and boost the confidence

of Hong Kong and Macao entrepreneurs to develop in Nansha, and encourage

numerous industries and businesses to compete in the global arena and to build

Nansha into a portal for high-level opening-up .

Source: Nansha District People's Government of Guangzhou City

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   Caption: The Urban landscape of Nansha Bay, Nansha district, Guangzhou