South China

Taxation on Real Estate Rental Income in China

Including city-specific details on Chengdu, Guangzhou and Shenzhen

Feb. 7 – Both Chinese nationals and a foreign individuals are subject to a combination of taxes on real estate rental income: including individual income tax (IIT), business tax (BT), property tax (PT), urban maintenance and construction tax (UMCT) and an education surcharge (ES).

If simply left to adding up all those rates according to each specific tax law, the taxation on individual rental income would end up pretty high. However, in a move to energize China’s housing supply market, the Chinese government began offering some tax incentives starting in 2008. Continue reading →

Posted in Central China, Finance, Tax and Accounting, Legal and Regulatory, South China | Tagged China Business Tax, China Chengdu, China Education Surcharge, China Guangzhou, China Individual Income Tax, China Individual Rental Income, China Individual Rental Tax, China Property Tax, China Shenzhen, China Urban Maintenence and Construction Tax | Leave a comment

Relax. South China Exports and Manufacturers are Doing Just Fine

Op/Ed Commentary: Chris Devonshire-Ellis

Feb. 1 – With some media spotlighting potential problems in South China – and one blog even going so far as to suggest smart Chinese businessmen are queuing up to attract orders, only to deliberately declare bankruptcy – it’s time to look again at the realities of the situation. The actual business environment in South China is something we are qualified to discuss with some knowledge – our firm, Dezan Shira & Associates, has four regional offices there (Hong Kong, Shenzhen, Guangzhou and Zhongshan) and has conducted business in the region for 20 years, while our Regional Partner Alberto Vettoretti is an adviser to the Shenzhen Government. Continue reading →

Posted in Business, FDI and Foreign Trade, Manufacturing, South China | Tagged China Exports, China Manufacturing, Chris Devonshire-Ellis, Dezan Shira & Associates, Guangzhou, Hong Kong, Shenzhen, South China, Zhongshan | 9 Comments

Guangzhou Simplifies Electronic VAT Declaration Procedures

Jan. 19 – Guangzhou’s value-added tax (VAT) small-scale taxpayers are no longer required to submit paper declaration forms when they file electronic VAT declarations.

According to the “Announcement on Canceling Paper Declaration Form Submissions During Small-Scale Taxpayers’ Electronic VAT Declaration (Guangzhou SAT Announcement [2012] No.1),” starting on January 15, VAT small-scale taxpayers that pay VAT based on auditing results and file VAT declarations electronically are not required to submit paper declaration forms anymore. Continue reading →

Posted in Finance, Tax and Accounting, Legal and Regulatory, Regulatory Update, South China | Tagged China Guangzhou VAT, China Tax, China Value Added Tax, China VAT Small-scale Taxpayer, Guangzhou, Online VAT Declaration, South China, Telephone VAT Declaration, VAT Declaration | Leave a comment

Twenty Years Ago, Deng Changed China Forever

The “socialist market economy” was born this week in 1992

Op-Ed Commentary: Chris Devonshire-Ellis

Jan. 16 – An anniversary occurs this week that may well go unnoticed by many – the 20th year since Deng Xiaoping, China’s premier at the time, visited Shenzhen as part of an unusual South China tour. To set the scene to recall why this was so important an event is to remember that China had not really fully opened up its economy on the back of reforms instigated by Deng in the late 1980s. What had at one stage seemed to be a sincere movement to open the country up came to a shuddering halt in the aftermath of the Tiananmen incident. I was in China at that time, employed by Asia Law & Practice (now part of Euromoney) – it was to be a further few months before I was to establish my firm, Dezan Shira & Associates. That I did so was almost entirely down to Deng’s visit. Continue reading →

Posted in Culture and History, Economy and Politics, South China | Tagged Chris Devonshire-Ellis, Deng Xiaoping, Opening Up, Shekou, Shenzhen, South China, Tour of South China | Leave a comment

Guangdong Party Boss Warns CPPCC of Hard Times Ahead

Jan. 13 – Wang Yang, the head of the Communist Party for China’s wealthy Guangdong Province, has alerted the Chinese People’s Political Consultative Conference (CPPCC) that the province faces a tough and difficult year ahead in 2012. Guangdong is by far the richest province in China, having boomed during China’s export crescendo, but has been hit with rising labor costs and falling orders. Many businesses in the province over the last three years have either closed or relocated to cheaper destinations in China or to Vietnam, Bangladesh or India.

Yang told the CCPPC that the next 12 months would likely be the toughest the province would face in the past 30 years of China’s reform and development, and stated the province “sat on the edge of economic difficulty, social conflicts and even political risk.” Continue reading →

Posted in Business, Economy and Politics, Markets, South China | Tagged China Manufacturing, China Wage Overheads, Chinese Communist Party, Guangdong, Labor Unrest, Moving Inland, South China | Leave a comment

Shenzhen, Beijing Raise Minimum Wage Standards

Jan. 12 – On December 31, 2011, both Shenzhen and Beijing announced their new minimum wage standards for 2012. Following the adjustment, Shenzhen’s minimum wage standard will reach RMB1,500, the highest in the whole country.

Shenzhen
According to the “Circular on Minimum Wage Standards Adjustment in Shenzhen (shenrenshegui [2011] No.19),” starting on February 1, 2012, Shenzhen’s minimum wage standards will be raised as follows:

Continue reading →

Posted in Business, Legal and Regulatory, Minimum Wages, Regulatory Update, South China | Tagged Beijing Minimum Wage, Beijing Piece-rates, China Minimum Wage, Full-time Minimum Wage, Part-time Minimum Wage, Shenzhen Minimum Wage | 2 Comments

Tax Agreement Signed between Hong Kong and Malta

Dec. 26 – On November 8, 2011, a comprehensive agreement for the avoidance of double taxation (DTA) was signed between the Hong Kong special administrative region government and the Maltese government. It will come into force after both governments finalize their respective ratification procedures.

The treaty eliminates the dual taxation of income in both jurisdictions. Absent the agreement, income earned by a Maltese national residing in HK would be subject to both Hong Kong and Maltese income tax, while Maltese enterprises operating through a branch in Hong Kong would also be taxed with both jurisdictions’ corporate tax. Under the agreement, taxes paid by companies on their profits in Hong Kong can be credited against their tax payable in Malta. Continue reading →

Posted in Finance, Tax and Accounting, Legal and Regulatory, Regulatory Update, South China | Tagged DTA Corporate Income, DTA Dividends, DTA Interest, DTA Royolties, Hong Kong Malta Double Tax Treaty | Leave a comment

Strong Showing for Chinese Cities on List of Asia-Pacific Cities of the Future

Dec. 22 – Chinese cities performed well in the new ranking of the Asia-Pacific Cities of the Future 2011-12 published by FDI Intelligence magazine, a bi-monthly news and foreign direct investment (FDI) publication owned by The Financial Times based in London.

The FDI future cities survey is carried out across 141 Asia-Pacific cities every two years. The ranking is made according to six criteria: economic potential, human resources, cost-effectiveness, quality of life, infrastructure and business friendliness. Continue reading →