Nov. 7 – As a city striving to become an international shipping center, Shanghai is brewing a complete package of favorable policies for its shipping-related industries. The new policies are hoped to significantly bring down shipping companies’ tax liabilities to levels similar to the shipping tax burdens seen in Hong Kong, experts say.
According to a report by the Shanghai-based newspaper Dongfang Daily, the government of Shanghai’s Pudong New Area – the city’s trading and financial center with high reliance on international shipping – will announce a series of supportive measures to motivate the development of shipping-related industries. The favorable policy package, which includes one-time subsidies, tax subsidies and soft environment improvement, will be offered to both key shipping companies (such as ship operators, shipping companies and logistics companies) and high-end shipping-related service companies (such as finance leasing companies, shipping insurance institutions, shipping information consulting institutions, shipping brokers, shipping-related legal service institutions and maritime training institutions).
Both types of the aforementioned companies – if meeting certain criteria – will have 100 percent of their tax payments (including corporate income tax, business tax and possibly value-added tax) on their local revenue and profit returned during the first three years (for key shipping companies) or two years (for high-end shipping-related service companies), and 50 percent of such tax payment returned during the next three years.
In addition, those companies will all be able to obtain incentive subsidies amounting up to 20 percent of their total registered capital.
Employees working for key shipping companies will also likely receive personnel-oriented subsidies. For company executives, subsidies up to 40 percent of their individual income tax (IIT) payment will be granted, and for middle managers and technical personnel, subsidies of up to 20 percent of their IIT payment will be offered.
With an eagerness to learn from the advanced shipping industries of foreign countries, Pudong will offer one-time subsidies to well-known domestic and foreign shipping institutions as it seeks to attract around 100 high-end foreign talents with shipping expertise during the next five to ten years. These imported talents will receive a desirable package of incentives – including a reward of RMB500,000, free board for five years as well as a housing subsidy of RMB500,000, and three-year’s of tax incentives.
A government document including all the details of the aforementioned incentives will likely be issued before the end of the year, according to an official working for the government of Pudong New Area.
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