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| Industry News |
| Software and Integrated Circuit Industries |
| 2008-05-15 10:30:48 |
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| The finance departments (bureaus), state tax bureaus and local tax bureaus of the provinces, autonomous regions, municipalities directly under the Central Government, municipalities separately listed on the State Plan, and the Finance Bureau of Xinjiang Army Corps of Production and Construction:
In order to further encourage the development of software and integrated circuit (IC) industries, the supplementary notice on the relevant preferential tax policies is hereby made as follows upon approval of the State Council and in accordance with the relevant provisions of the existing tax law:
I. From January 1, 2002 to the end of 2010, with respect to the self-made IC products (including monocrystalline silicon wafers) sold by value-added tax (VAT) general taxpayers, after the VAT has been collected at a 17% rate, the policy of "refund upon collection" shall be applied to the actual VAT load that exceeds 3%, and the tax refunded shall be used by the enterprises in the expansion of production and the study and development of IC products.
II. With respect to the production enterprises of IC products whose product line is less than 0.8 micron (including 0.8 micron) wide, after certification, the policy of "two-year exemption and three-year reduced payment" of enterprise income tax shall be applied from the year when the enterprise begins to make profits from 2002, that is, for the first and second year after the enterprise begins to make profits, the enterprise income tax shall be exempted, and from the third to fifth year, the enterprise income tax shall be half exempted.
The enterprises with foreign investment that have already enjoyed "two-year exemption and three-year reduced payment" of enterprise income tax from the profit-making year, according to the Law on Income Tax of Enterprises with Foreign Investment and Foreign Enterprises and the detailed rules for implementation thereof, shall no longer implement this Article.
With regard to the enterprises with foreign investment that may enjoy exemption of enterprise income tax for two years from the profit-making year according to the Law on Income Tax of Foreign-funded Enterprises and Foreign Enterprises and the detailed rules for implementation thereof, if the "two-year exemption" of enterprise income tax actually enjoyed expired before 2002 (excluding 2002), then the "two-year exemption" shall not be implemented for a second time; if the "two-year exemption" of enterprise income tax has been actually enjoyed for less than 2 years before 2002 (excluding 2002), the remaining period of tax exemption and the "three-year reduced payment" shall be implemented from thereon. |
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