Legislation roundup: Foreign investment tax incentives, Data transfer and Commercial cryptography
STA offers substantive tax deduction incentives to foreign investors. CAC specifies procedures for extending security assessment approval for cross-border data transfers. Critical information infrastructure operators are required to conduct security assessments before applying commercial cryptography.
Tax
State Taxation Administration, Announcement on the Tax Set-Off Policy for Direct Investment of Distributed Profits by Foreign Investors
财政部、国家税务总局、商务部关于境外投资者以分配利润直接投资税收抵免政策的公告
Where the profit distributed to a foreign investor by a tax-resident PRC enterprise and used for a domestic direct investment during the period between January 1, 2025 and December 31, 2028 satisfies conditions, the tax payable by the foreign investor for the year in question may be offset at the rate of 10% of the amount invested, and where the amount is insufficient to set off in the year in question, it may be carried forward to later. Where the tax rate applicable to dividends, bonuses and other such equity investment returns in a tax agreement entered into by the government of the People’s Republic of China and a foreign government is less than 10%, matters shall be handled in accordance with the tax rate specified in the agreement.
This premium content is reserved for
China Law & Practice Subscribers.
A Premium Subscription Provides:
- A database of over 3,000 essential documents including key PRC legislation translated into English
- A choice of newsletters to alert you to changes affecting your business including sector specific updates
- Premium access to the mobile optimized site for timely analysis that guides you through China's ever-changing business environment
Already a subscriber? Log In Now