FREMONT, CA: According to the State Council’s Executive Meeting, China is likely to enhance the steady growth of the industrial economy and support the services sector in special difficulty. The importance of the industrial and service sectors in economic development and job stability was emphasised at the meeting. Because the industrial economy is still recovering and some service businesses are currently experiencing exceptional difficulties as a result of COVID-19, steps to provide stronger support will be implemented quickly.
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According to the State Council’s Executive Meeting, China is likely to enhance the steady growth of the industrial economy and support the services sector in special difficulty. The importance of the industrial and service sectors in economic development and job stability was emphasised at the meeting. Because the industrial economy is still recovering and some service businesses are currently experiencing exceptional difficulties as a result of COVID-19, steps to provide stronger support will be implemented quickly.
The manufacturing and service sectors are likely to receive more income tax relief. This year, micro, small, and medium-sized businesses that buy new equipment worth more than 5 million yuan (about 786,000 dollars) with a 3-year depreciation period are eligible for a one-time deduction of total purchase costs from taxable income, or a 50 percent deduction for equipment with a four, five, or ten-year depreciation period.
MSMEs in the manufacturing sector are likely to benefit from tax deferral schemes. All low-profit small businesses and self-employed households will be covered by the policy to reduce or waive six local taxes and two fees (namely, resource tax, urban maintenance and construction tax, real-estate tax, urban land use tax, stamp tax, and tax on farmland used for non-agricultural purposes, as well as education surcharge and local education surcharge).
Financial services will be strengthened with guidance. The People's Bank of China will provide incentive financing to help micro and small firms get more loans. Efforts will be made to support a relatively quick increase in medium and long-term manufacturing loans. These will allow for a continuing decrease in the overall financing expenses of firms.
The manufacturing sector's industrial and supply chains will be strengthened, weak links will be repaired, and the industrial basis will be rebuilt. Efforts to construct new infrastructure and enhance energy-saving and low-carbon technology in crucial locations will be accelerated. These will help to increase the efficiency of investment.
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