Author Archives: China Briefing

Finding Your “Comfort Zone”: A Guide to Industrial Parks in the Yangtze River Delta (Part 2)

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By Rainy Yao

SHANGHAI — Over its four years of development, the Yangtze River Delta (YRD) Economic Region has taken a leading role in China’s economy. In 2013, the region’s GDP was close to RMB10 trillion, accounting for 17.2 percent of national GDP. Attracted by potential revenues and preferential policies, more and more foreign investors have chosen to establish their businesses in the YRD, especially in its many development zones. But given that these zones vary in terms of the tax policies and investment environments they can provide, it can be hard to tell which is right for your business. In this second part of our two-part series, we continue with our comparison of five major types of development zones in the YRD to help foreign investors find the best fit for their specific industry. Continue reading…

Shanghai Chosen as Site of BRICS Development Bank

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SHANGHAI — Things came down to the wire in Brazil this week—not in the World Cup final but for the details of a development bank to be jointly funded by BRICS (Brazil, Russia, India, China and South Africa). In the end it was confirmed that the bank, aptly named the New Development Bank (NDB), would be headquartered in Shanghai and its initial presidency held by an Indian national. The move is widely expected to bolster Shanghai’s bid to become an international financial center by 2020.

The NDB, designed to finance infrastructure projects in BRICS and other emerging nations, will have an initial subscribed capital of US$50 billion, contributed in equal shares of US$10 billion by its 5 member states. Voting rights will be split between the five founding members and decisions made via a two-thirds majority. Although membership will be open to future additions, it is stipulated that BRICS must retain a controlling stake of at least 55 percent. Continue reading…

What China’s Latest Anti-Corruption Campaign Means for Foreign Investment

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SHANGHAI – It has become common practice in China that every major leadership transition be swiftly followed by an anti-corruption campaign, and the last leadership change in March 2013 has certainly proven consistent. President Xi Jinping’s campaign to crack down on “both tigers and flies”— high-ranking officials and lower-level bureaucrats—has adopted a forceful approach to the issue and grown into one of the broadest anti-corruption campaigns in recent memory. Continue reading…

Finding Your “Comfort Zone”: A Guide to Industrial Parks in the Yangtze River Delta (Part 1)

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By Rainy Yao

SHANGHAI — The Yangtze River Delta (YRD) Economic Region, comprised of 16 cities (i.e., Shanghai, Nanjing, Suzhou, Wuxi, Changzhou, Yangzhou, Zhenjiang, Nantong, Taizhou, Hangzhou, Ningbo, Huzhou, Jiaxing, Shaoxing, Zhoushan and Taizhou) in Zhejiang and Jiangsu provinces, is the largest megaregion in the world. In 2010, the State Council released the “Yangtze River Delta Regional Plan,” promoting the YRD as a key international gateway for the Asia-Pacific region, as well as an important global center for the modern service and manufacturing industries. The Plan establishes a target per capita GDP in the region of RMB110,000 by 2020. Continue reading…

China Regulatory Brief: Electric Vehicle Tax Exemptions & VAT Rates for Cargo Industry

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China Clarifies VAT Rate for International Cargo Transport Agency Service

On July 4, the State Administration of Taxation (SAT) released the “Announcement on Value-added Tax (VAT) Issues in International Cargo Transport Agency Service (SAT Announcement [2014] No. 42).” According to the Announcement, taxpayers indirectly engaged in agent services such as international cargo transport, transportation tools entering and departing the port, pilotage arrangement and loading & unloading shall be exempt from VAT. The Announcement will take effect on September 1, 2014. Continue reading…

Online Tax Services Launched in the Shanghai FTZ

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SHANGHAI – In yet another pilot reform perhaps someday destined for nationwide implementation, China’s State Administration of Taxation (SAT) has launched a number of innovative tax services in the Shanghai Free Trade Zone (FTZ). In the related “Notice” issued by the SAT, the reforms are described as providing taxpayers with a simplified tax system in terms of both time and costs.

Under the new system, businesses will be able to complete tax registration, manage invoices and apply for electronic invoices via an online system. This is expected to greatly benefit taxpayers using domestic cargo transportation services, warehouse storage services and lifting & material handling services in the Yangshan Free Trade Port Area. Taxpayers will also be able to file their taxes quarterly (rather than monthly, as is standard) and enjoy instant tax returns. Continue reading…

Electric Vehicles Receive Tax Exemption in China

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SHANGHAI – China will waive the 10 percent vehicle purchase tax for “new energy vehicles” beginning September 1, in a bid to boost demand for electric vehicles and address pollution problems.

The tax break applies to both locally produced and imported electric cars, plug-in hybrids and fuel-cell vehicles, and will last until the end of 2017.

The exemption is China’s latest measure to expand the country’s electric vehicle market, which it identifies as a crucial step towards addressing environmental pollution, energy conservation and industry innovation, a “win-win” situation for industrial development and environmental protection, according to the statement released by the State Council on Wednesday. Continue reading…

Jing-Jin-Ji: The Biggest City in China You’ve Probably Never Heard Of

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By Rainy Yao and Emily Liu

BEIJING — On June 23, the General Administration of Customs (GAC) released an announcement on integrating the customs procedures of Beijing, Tianjin, and Hebei (GAC Announcement [2014] No. 45), marking an important milestone in the integration of the three jurisdictions into a single “megaregion” in China’s northeast. Under the integrated customs system, enterprises established in any of the three jurisdictions can choose between importing/exporting goods via the Customs of their original business registration or alternatively, the Customs through which the goods are actually shipped. The integrated system came into effect in Beijing and Tianjin on July 1, 2014 and will begin in Shijiazhuang, Hebei on October 1, 2014.

This is just the latest in a series of measures announced by the National Development and Reform Commission (NDRC) towards the realization of the Beijing-Tianjin-Hebei megaregion, covering 216,000 square kilometers and home to more than 100 million people. Ultimately, the Chinese leadership has plans to create 10 megaregions around the country, including inland areas such as Shandong and Liaoning. Continue reading…

Asia Briefing Bookstore Catalogue 2013