Shenzhen's latest preferential tax policies for enterprises have begun to manifest desirable effects, as the policies are bringing tangible benefits to companies by reducing their tax burden and generating more cash flow to unleash market vitality, the Shenzhen Special Daily reported yesterday.
In the first quarter of 2019, the additional tax cuts resulting from the larger-scale tax reduction policies have totaled 14.37 billion yuan (US$2.08 billion), covering all sectors of society, statistics from the Shenzhen Municipal Tax Bureau showed.
The manufacturing industry, in particular, has benefited most from the policies, witnessing tax cuts totaling 3.9 billion yuan, accounting for 27.1 percent of the total.
According to Shenzhen Jinxun Software Communication Technology Co. Ltd., the company enjoyed 2.78 million yuan in corporate income tax deductions and 3 million yuan in export tax rebates last year.
In 2019, it is estimated that the company will enjoy a total of 10.25 million yuan in tax cuts, which will include 7.25 million yuan worth of corporate income tax deductions and 3 million yuan of export tax rebates.
Shenzhen Skyworth-RGB Electronics Co. Ltd., one of the top 100 taxpaying enterprises in Nanshan District, is also a beneficiary of the preferential taxation.
According to statistics disclosed by the firm, the company enjoyed an additional deduction of R&D expenses amounting to 254 million yuan in 2018, an increase of 71 million yuan over the same period last year.
The company also received a tax rebate of 176 million yuan for embedded software in 2018 and a tax rebate of 62 million yuan for embedded software from January to May this year.
The company currently has more than 24,000 employees. Benefiting from the tax reduction policies, nearly 10,000 production line workers in the firm will be exempt from individual income tax, while the income tax of other employees will be cut by more than 30 percent, according to the Daily.
At a seminar organized by Nanshan District’s tax bureau last week, a representative with Shenzhen Headsun Technology Co. Ltd. disclosed that the company is planning to relocate a factory, which they had moved to neighboring Dongguan, back to Shenzhen.
“Some of our equipment and the factory were moved to Dongguan from Nanshan a long time ago, but we have recently considered relocating because of the various tax incentives and government support for enterprises in Nanshan,” the representative was quoted as saying.
According to the representative, the company has received a great number of discounts in the form of additional deductions for R&D expenses and corporate income taxes, and has also benefited directly from software tax rebates.