China will introduce more tax cuts and lower administrative fees in order to support the development of small and micro-sized businesses to promote entrepreneurship and innovation.
According to a State Council executive meeting chaired by Premier Li Keqiang on Feb 25, fiscal and tax policies should be strengthened, and the country will unleash more preferential policies in addition to the existing measures for enterprises.
The new measures for cutting tax and lowering administrative fees include:
* The beneficiaries will be expanded from those with annual taxable earnings not higher than 100,000 yuan ($16,000) to those with annual taxable earnings not higher than 200,000 yuan. The business income tax rates for the benefited businesses will be 20 percent.
* Actual investment interests brought by non-monetary assets - such as private stock shares, properties, technological invention - will witness nationwide implementation of a policy that requires the one-time payment of corresponding taxes to be replaced by installment payment.
* For the benefited enterprises, the rate of unemployment insurance fees will be lowered from 3 percent to 2 percent, which is preliminarily estimated to save more than 40 billion yuan every year for employers and employees.
Fast tracking water dam construction
The State Council has decided on plans to fast-track the construction of major water resource projects in order to promote restructuring of the economy and boost the development of relevant sectors.
Of the 172 major projects that have been included in the scope of governmental planning, 57 have started construction, 27 will start construction within this year, and the remainder should strive to start construction as soon as possible, according to the meeting.
The goals decided are stated as below:
* The system of responsibility for realizing the proposed goals should be enhanced. Project approval and funding allocation should be accelerated, and feasibility studies for projects should be finished before the end of this July. Added funds specially prepared for the relevant expanded projects should be in place before the end of this May, and the overall water resource investment within the budget of the central government should see 90 percent in place before the end of this June.
* The role of those financing for initial development should be fully utilized, and transitional funding support should be given - in forms such as specially prepared bridging loans - to the localities that will host water resources construction. Local governments are also advised to tweak the structure of expenditure to raise money for construction.
* Reforms should be rolled out, and with the interest discount offered by the treasury authorities and other market-based financing channels, social capital will be encouraged to participate in the construction of such major projects.
* Special inspection and supervision will be conducted for the corresponding provinces and projects to tackle any possible delays, and relevant officials will be held accountable for serious delays.
National allowance raised
The State Council has decided to raise the national allowance standard intended for students from secondary vocational schools and senior high schools.
The decision aims at boosting assistance to the students’ families that are faced with financial challenges and accelerating the cultivation of technology-oriented talents, according to the meeting.
The national allowance standard for students from secondary vocational schools and senior high schools will be increased from 1,500 yuan each year to 2,000 yuan each year from the spring semester of 2015, and surveys should take speed for perfecting college tuition loan policies.