Tax issues are related to the immediate interests of taxpayers, and tax reform implies the redistribution and adjustment of interests. From the perspective of comprehensive data, this year's tax reform is reflected in a series of dividend policies through the gradual implementation of the principle of tax law, the promulgation of tax cuts and fee reductions to benefit enterprises and the public, further optimization of various taxes, and the collaborative development of various regions, etc. Through these policies, the burden of market entities has been reduced, and confidence in enterprise investment and development has been strengthened, and the dividends of the reform have injected new kinetic energy into the market entities and economic development.

I. Accelerating the Process of Taxation Statute, Taxation Rule of Law Construction Entering the "Fast Track"

The principle of tax law is the basic principle of tax law, emphasizing that the rights and obligations of both parties must be stipulated by law, and that all kinds of constituent elements of tax must be and can only be clarified by law.In November 2013, the Decision of the CPC Central Committee on Several Major Issues Concerning Comprehensively Deepening Reforms, adopted by the Third Plenary Session of the 18th CPC Central Committee, put forward the principle of "implementing the legal principle of taxation" for the first time. On May 6, 2022, the Standing Committee of the National People's Congress published the legislative work plan for the year 2022 on the "China National People's Congress Website". legislative work plan for the year 2022. In this document, the NPC Standing Committee explicitly listed "tax laws such as the Customs Tariff Law" among the laws to be considered for the first time. The author summarizes the country's tax legislation activities and trends in 2022 from the following three aspects:

(I) The draft law on value-added tax (VAT) has been submitted for consideration and public consultation.

On December 27, 2022, the Draft Law of the People's Republic of China on Value-Added Tax (VAT) was submitted to the Standing Committee of the 13th National People's Congress (NPC) for the first time for deliberation at its 38th meeting. After the deliberation and adoption, the (Draft) Law of the People's Republic of China on Value-added Tax was published on December 30 and open for public comments.

(II) Draft Customs Tariff Law and Draft Consumption Tax Law in Progress

Since the Decision of the Central Committee of the CPC on Several Major Issues Concerning Comprehensively Deepening Reforms put forward the need to "implement the principle of legalizing taxation", the process of China's tax legislation has accelerated significantly, and up to now, 12 of the 18 existing taxes have been enacted into law. In addition to the VAT mentioned above, according to the Legislative Work Plan of the State Council for the Year 2022 published by the General Office of the State Council on July 14, 2022, the legislative work of submitting the draft Customs Tariff Law to the Standing Committee of the National People's Congress (NPC) for deliberation, submitting the draft Consumption Tax Law to the Standing Committee of the NPC for deliberation, and submitting the draft amendment to the Measures for the Administration of Invoices, etc., is being actively and steadily promoted. According to the provisions of the Legislative Law, the bills on the agenda of the Standing Committee meetings should generally be considered by three Standing Committee meetings before being put to a vote, and if the opinions of various parties are more consistent, they can be considered by two Standing Committee meetings before being put to a vote. Therefore, taxpayers need to continue to pay attention to the deliberation and release of the draft legislation on consumption tax and customs duty.

(III) Real estate tax incorporated into legislative planning

The issue of real estate tax legislation is a hot tax issue that has attracted much attention from all walks of life in recent years.On May 18, 2020, the Central Committee of the Communist Party of China and the State Council issued the Opinions on Accelerating the Improvement of the Socialist Market Economic System in the New Era. The Opinions pointed out that it is necessary to accelerate the establishment of a modern financial and taxation system, and to steadily push forward the legislation on real estate tax.2021 On October 23, 2021, the 31st Meeting of the Standing Committee of the Thirteenth National People's Congress passed the Decision of the Standing Committee of the National People's Congress on Authorizing the State Council to Carry Out Pilot Work on Real Estate Tax Reform in Some Areas, which made clear that: in order to actively and steadily push forward real estate tax legislation and reform, guide the reasonable consumption of housing and the economical and intensive use of land resources, and promote the stable and healthy development of the real estate market, the State Council is authorized to carry out the pilot work of real estate tax reform in some areas for a period of five years, and to formulate the law in a timely manner when the conditions are ripe. The legislation and introduction of real estate tax is conducive to the improvement of the local tax and direct tax system and the optimization of the tax structure, and can play a role in regulating income distribution, stabilizing the macroeconomy and promoting social equity.

II. Tax cuts and fee reductions benefit enterprises and people, and stimulate the vitality of market players

(I) Tax and fee reductions are effective and fruitful

According to the data of the State Administration of Taxation (SAT), from January to October 2022, individual industrial and commercial households have enjoyed a total of 325.8 billion yuan of tax and fee reductions. As of November 10, 2022, the national tax system has handled a total of more than 3.7 trillion yuan of new tax reductions and fee reductions as well as tax refunds and deferred tax and fee reductions, and the annual scale is expected to be more than 4 trillion yuan.On April 1, 2022, the Ministry of Finance and the State Administration of Taxation introduced a large-scale policy of tax credits and refunds, and the amount of tax credits and refunds has reached 2309.7 billion yuan in total as of November 10, 2022.Through the implementation of a series of tax support policies, significantly reducing the burden on market players, easing the pressure on enterprise cash flow, effectively enhancing the endogenous momentum of development, helping to stabilize the macroeconomic plate, and strongly boosting market confidence in the context of the epidemic.

For more than two years, the survival and development of market players have been continuously impacted by the epidemic, and tax cuts and fee reductions are one of the most effective means of support for market players. The combined tax support policy of tax reduction and exemption and the abolition or suspension of administrative fees and charges is a key move to withstand the downward pressure of the economy and promote the stable and healthy operation of the economy, and it can help enterprises to cope with the impact of the epidemic and promote the steady recovery of production and life, and it is an important hand to cope with the difficult challenges and the complicated and volatile international environment, and it plays a very important role in the development of the economy. Through tax cuts, tax exemptions, tax deferral, tax rebates, the abolition or suspension of administrative fees and other policies stacked power, playing a combination of punches, helps to do a good job in helping enterprises to alleviate their difficulties on multiple levels, and plays an important role in stabilizing market players and safeguarding employment and people's livelihoods.

(II) New measures to reduce taxes and fees are coming heavily, and these enterprise-friendly tax and fee policies may be continued

On July 8, 2022, the State Administration of Taxation ("SAT") issued the "Guidelines on Combined Tax and Fee Support Policies", which sorted out the new and extended tax and fee reduction policies for the year 2022, of which 13 new tax and fee support policies were introduced and 20 tax and fee support policies were extended. Taking VAT as an example, according to the Announcement of the Ministry of Finance and the State Administration of Taxation on Further Increasing the Implementation of the Policy of VAT Ending Allowance Refund (No. 14 of 2022) and the Announcement of the Ministry of Finance and the State Administration of Taxation on Further Accelerating the Progress of the Implementation of the Policy of VAT Ending Allowance Refund (No. 17 of 2022), the policy of VAT ending allowance refund for small and micro-enterprises was increased and the advanced manufacturing industries the scope of the policy of refunding the full amount of incremental VAT tax credit on a monthly basis to eligible small and micro enterprises (including individual industrial and commercial households), and refunding the tax credit on the stock of small and micro enterprises on a one-off basis. For example, according to the Announcement of the Ministry of Finance and the State Administration of Taxation on the VAT Policies Relating to the Promotion of Relief and Development of Difficult Industries in the Service Sector (No. 11 of 2022), VAT prepayment by branches of air and rail transportation enterprises will be suspended from 1 January 2022 to 31 December 2022, and VAT prepayment by branches of air and rail transportation enterprises will be suspended from the tax filing period of February 2022 to the deadline of the Announcement of the Ministry of Finance and the State Administration of Taxation on the Promotion of Relief and Development of Difficult Industries in the Service Sector. Announcement on VAT Policies Relating to the Relief and Development of Difficult Industries in the Service Sector" (No. 11 of 2022) was issued (March 3, 2022), the prepaid VAT was refunded.

In addition, according to the deployment of the 2022 National Fiscal Work Video Conference, the focuses on tax and fee policies in 2023 include improving tax and fee support policies, optimizing the structure of the tax system, and further deepening the reform of the fiscal and taxation system. In terms of tax and fee support policies, the policy of exempting small-scale taxpayers from VAT for monthly sales of less than 150,000 yuan expired on December 31, 2022.On January 9, 2023, the Ministry of Finance and the State Administration of Taxation (SAT) issued the Announcement on Clarifying the Policies of Reducing and Exempting VAT and Other Policies for Small-Scale Taxpayers of Value-added Tax (VAT) (Announcement No. 1 of 2023 of the Ministry of Finance and the SAT). On the same day, the State Administration of Taxation ("SAT") issued the Announcement on Matters Relating to the Levy and Administration of VAT Reductions and Exemptions and Other Policies for VAT Small-Scale Taxpayers ("SAT Announcement No. 1 of 2023"), the Ministry of Finance SAT Announcement No. 1 of 2023 and the SAT Announcement No. 1 of 2023 adjust the caliber of the exemptions for small-scale taxpayers, and the VAT small-scalar taxpayers who incur VAT-taxable sales behavior, and the aggregate monthly sales do not exceed RMB 100,000 (or RMB 300,000 for quarterly sales if one quarter is used as a tax period), they are exempt from VAT. The VAT Law (Draft) currently under consideration specifies that the starting point of VAT shall be stipulated by the State Council, and it is expected that after the introduction of the VAT Law, the legislative level of the policy on the starting point of VAT for small taxpayers will be elevated to the State Council's administrative rules and regulations, but it may still be issued by the Ministry of Finance and the State Administration of Taxation as a normative document during the transitional period. In terms of tax rebate policy, Article 16 of the Value-added Tax Law (Draft) has added the provision that the portion of current input tax that is greater than current output tax can be refunded, and the future tax rebate policy may be normalized. In terms of tax and fee reduction, with the full liberalization of epidemic control measures, some policies may be terminated, and enterprises need to continue to pay attention to the relevant legislative developments.

III. Individual Income Tax Reform Accelerates the Release of People's Livelihood Dividends

In recent years, the common wealth of all sectors of society, as an important tax to regulate the distribution of residents' income, personal income tax reform has once again become the focus of heated discussions.January 1, 2019, the newly amended Individual Income Tax Law and its implementing regulations came into force, raising the starting point of individual tax, clarifying the scope of the comprehensive income tax, optimizing and adjusting the structure of the tax rate, and initially establishing a comprehensive and categorical combination of individual income tax system. At the same time, the Child Education, Continuing Education, and Tax System were established. At the same time, the establishment of children's education, continuing education, medical treatment for serious illnesses, housing loan interest, housing rent, and support for the elderly a total of six special additional deductions. 2022, in order to alleviate the burden of taxpayers, the State Administration of Taxation and the relevant departments have introduced a number of preferential policies to further release the benefits of the people's dividends.

(I) Multi-departmental coordination and multiple measures to reduce the tax burden on low and middle-income earners

On March 28, 2022, the Circular of the State Council on the Establishment of Special Additional Deduction for Individual Income Tax for the Care of Infants and Young Children Under 3 Years of Age (Guofa [2022] No. 8) was issued, which clearly states that, starting from January 1, 2022, the taxpayers' expenses related to the care of their children who are infants and young children under 3 years of age shall be deducted in accordance with the standard of 1,000 yuan per month for each infant and young child, so as to further alleviate the tax burden of the taxpayers. tax burden.

On November 4, 2022, the Ministry of Finance ("MOF") and the State Administration of Taxation ("SAT") issued the Announcement of the MOF and the SAT on the Individual Income Tax Policies Regarding Individual Pensions (Announcement of the MOF and the SAT No. 34 of 2022), which clarified that, starting from January 1, 2022, the preferential policy of deferred taxation on individual pensions would be implemented in 36 pioneer cities and regions, including Beijing, Shanghai, Guangzhou and Wuhan. With this, the State Administration of Taxation (SAT) issued specific practical guidelines for retirees.

On September 30, 2022, the Announcement of the Ministry of Finance and the State Administration of Taxation on the Individual Income Tax Policies Relating to the Support of Residents' Exchange and Purchase of Housing (Announcement of the Ministry of Finance and the State Administration of Taxation No. 30 of 2022) and the Announcement of the State Administration of Taxation on the Matters Relating to the Levy and Management of Individual Income Tax Policies for the Support of Residents' Exchange and Purchase of Housing (Announcement of the State Administration of Taxation No. 21 of 2022) were issued to make it clear that the following was clearly stated: from From October 1, 2022 to December 31, 2023, taxpayers who sell their own housing and re-purchase housing in the market within 1 year after the sale of their current housing will be given a tax rebate for the individual income tax they have paid on the sale of their current housing. By improving the individual income tax system, regulating the order of income distribution, standardizing the mechanism of wealth accumulation, protecting legitimate income, regulating excessive income and outlawing illegal income, the strength and precision of the individual income tax in regulating the distribution of income can be brought into full play to promote the realization of the goal of common prosperity.

(II) Procedural optimization of service initiatives, taxpayers for the annual remittance more convenient

In order to implement the requirements of the Opinions on Further Deepening the Reform of Tax Levy Management issued by the General Office of the CPC Central Committee and the General Office of the State Council, safeguard the legitimate rights and interests of taxpayers, and help taxpayers complete the comprehensive income tax remittance in a smooth and standardized manner, the State Administration of Taxation (SAT) has, on the basis of comprehensively summing up the remittance work of the previous years, fully listened to the opinions and suggestions of taxpayers, withholding agents, experts, scholars, and the public. The State Administration of Taxation (SAT) has issued the Announcement of the State Administration of Taxation on Matters Concerning the Handling of Comprehensive Individual Income Tax for the Year 2021 (SAT Announcement No. 1 of 2022). The Announcement facilitates taxpayers to handle annual remittance in two aspects.

(1) Providing "tax appointment" service at the early stage of annual settlement. In order to provide better services to taxpayers, the function of tax appointment at the early stage of the annual accounting has been introduced in 2022 to make the tax public service more efficient, quality and orderly through appointments. All taxpayers who have the need for tax application during the period of March 1-15, 2022, can make an appointment for processing time through the Natural Person Electronic Taxation Bureau after February 16 (inclusive), and apply for the annual remittance in accordance with the appointment time, so as to further enhance the taxpayers' experience of processing.

(2) Clarify the competent tax authority after the end of the annual remittance period. After the end of the annual remittance period, a competent tax authority will be determined in accordance with the rules for taxpayers who fail to apply for annual remittance on time. The relevant rules are basically consistent with the rules for determining the tax authorities accepting the annual remittance declaration in Article 9 of the Announcement. This practice makes it easier for taxpayers to find a competent tax authority to provide tax-related service management for them when they subsequently apply for annual accounts.

As far as tax procedures are concerned, it is crucial to provide convenience to taxpayers by reducing compliance costs. In order to facilitate taxpayers' tax payment, the State Administration of Taxation (SAT) has taken a number of measures to alleviate the burden of taxpayers' business operations in all aspects and from all angles, to reduce taxpayers' compliance costs and to improve taxpayers' satisfaction.

IV. Optimizing the tax structure and improving the tax system

(I) Gradual Improvement of the Value-added Tax System

Value-added tax (VAT) plays a pivotal role in China's overall tax system. According to the latest data from the Ministry of Finance, from January to November 2022, the national tax revenue totaled 15,282.6 billion yuan, and the domestic VAT revenue totaled 4,353.0 billion yuan, accounting for 28.48%. Since 2018, greater efforts have been made to stimulate market vitality and social creativity through policies such as raising the VAT threshold for small-scale taxpayers and lowering the VAT rate twice. In addition, it has also benefited enterprises and people through the implementation of the VAT tax credit and refund policy to promote economic development.In 2018, China began to implement three reforms: lowering the tax rate, implementing tax credit and refund on a trial basis for some industries, and unifying the standards for small-scale taxpayers.In 2019, the tax rate was further lowered, the scope of input tax credit was expanded, the tax credit and refund system was formally set up, and a phased additive credit and deduction policy was introduced.Between 2020 and 2021, combined with the characteristics and needs of the various stages of epidemic prevention and control, intensively introduced a number of support policies in batches, and expanded the scope of the policy of full refund of incremental tax credits for some advanced manufacturing industries.2022, even further increased the support of preferential VAT policies for universal VAT, and the implementation of a large-scale VAT tax credit rebate.2022 The "VAT Law of the People's Republic of China (Draft)" published on December 30, 2022 The VAT Law of the People's Republic of China (Draft), published on December 30, 2022, adds an end-of-period tax credit refund system, with Article 16(1) stating that "the portion of the current input tax amount that is greater than the current output tax amount can be carried forward to the next period to continue to be deducted or refunded, and the specific methods shall be stipulated by the competent departments in charge of finance and taxation under the State Council". To sum up, the VAT reform has further optimized the VAT tax structure through the above tax rate reduction, expansion of the scope of credit and refund of retained credits, etc., which has played an important role in boosting the confidence of enterprises, stimulating the vitality of market players, and practically helping the industry to resume the development under the epidemic, promoting the employment, and safeguarding the stability.

(II) In-depth optimization of the enterprise income tax system

In recent years, China has continuously optimized and adjusted the policy of adding deduction for R&D expenses and improved the policy of accelerated depreciation to help enhance the innovation and development capability of enterprises. in early 2013, a pilot project was launched to expand the scope of the policy of adding deduction for R&D expenses, and the pilot policy was extended to the whole country in September 2013. in 2015, the scope of R&D activities and R&D expenses of enterprises enjoying the preferential treatment was relaxed, and the attribution of R&D expenses in the tax treatment was simplified. expenses in tax treatment, simplified the management of the aggregation, accounting and filing of expenses, and further reduced the threshold for enterprises to enjoy the preferences.In 2017, the proportion of pre-tax deduction for R&D expenses of science and technology-based small and medium-sized enterprises (SMEs) was increased to 75%, and the main body of the policy to enjoy the preferences was further expanded to almost all enterprises in 2018. The system of halving the enterprise income tax for small and micro-profit enterprises has been continuously strengthened, and the scope of application and the magnitude of tax reduction have been further expanded.In 2021, the policy of adding deduction for R&D expenses has been "upgraded twice". In 2021, the policy of additional deduction for R&D expenses was "upgraded twice", with the proportion of R&D expenses of manufacturing enterprises increased from 75% to 100%, and from October 2021, enterprises could advance the deduction of R&D expenses for the first three quarters when they prepaid their enterprise income tax, and at the beginning of 2022, the proportion of R&D expenses of science and technology-based small and medium-sized enterprises (SMEs) was increased to 100%. Afterwards, according to the development and change of the situation, it further allows one-time full pre-tax deduction and 100% additional deduction for the expenditure of high-tech enterprises on the acquisition of equipment in the fourth quarter of 2022; in the fourth quarter of 2022, it uniformly increases the deduction ratio to 100% for the industries that currently deduct R&D expenses at a ratio of 75% pre-tax; and allows full pre-tax deduction and 100% additional deduction for the expenditure of enterprise-funded scientific research institutes and other basic research expenditures. full pre-tax deduction and additional deduction. By optimizing and adjusting the enterprise income tax system and giving full play to the counter-cyclical adjustment of tax, the innovation ability and development vitality of small and medium-sized enterprises have been effectively stimulated, and an important role has been played in coordinating the prevention and control of epidemics and economic and social development, as well as in serving the "six stabilizers" and the "six guarantors". The tax revenue has played an important role in integrating epidemic prevention and control and economic and social development, and serving the "six stabilizations" and "six guarantees".

(III) Consumption tax system is becoming increasingly sound

On November 12, 2013, the Third Plenary Session of the 18th CPC Central Committee proposed to "adjust the scope, links and tax rates of consumption tax, and bring high-energy-consuming and high-polluting products and some high-grade consumer goods into the scope of taxation", and the Overall Plan for Deepening the Reform of the Fiscal and Tax System, which was considered and passed by the Politburo of the Central Committee of the Communist Party of China (CPC) on June 30, 2014, further proposed to "improve the consumption tax system". The overall plan for deepening the reform of the fiscal and taxation system further proposes to "improve the consumption tax system. Adjust the scope of levy, optimize the tax rate structure, improve the levy link, and enhance the regulatory function of consumption tax." Starting from October 1, 2016, the consumption tax on ordinary beauty and grooming cosmetics was abolished, and the name of the tax item "Cosmetics" was renamed as "High-grade Cosmetics", with the scope of taxation including high-grade beauty and grooming cosmetics, high-grade skin-care cosmetics and complete sets of cosmetics, and the tax rate was changed from 30% to 30%. Starting from December 1, 2016, a sub-tax item of "ultra-luxury cars" was added under the tax item of "small cars", and the consumption tax for ultra-luxury cars was levied at the current rate in the production (import) segment, and an additional 10 percent was added in the retail segment on top of the current tax rate. On October 2, 2022, the Ministry of Finance, the General Administration of Customs and the State Administration of Taxation issued the Announcement on the Collection of Consumption Tax on Electronic Cigarettes (Announcement of the Ministry of Finance, the General Administration of Customs and the State Administration of Taxation No. 33 of 2022), which explicitly pointed out that electronic cigarettes were included in the scope of the consumption tax and electronic cigarettes were added as a sub-tax item under the cigarette tax. Steadily promoting the reform of consumption tax has a promoting effect on improving the consumption tax system, maintaining the fairness and unity of the tax system, and playing a role in guiding healthy consumption by consumption tax.

V. Regional Tax Preferential Policies, Focus on Coordinated Development, Serve Regional Synergy

The Opinions on Accelerating the Improvement of the Socialist Market Economic System in the New Era, issued by the CPC Central Committee and the State Council on May 11, 2020, proposes to improve the local tax system, adjust and improve the local tax system, cultivate and grow the local tax sources, and steadily expand the right to manage the local tax, with an aim of stabilizing the ratio of central and local distribution and coordinating the regional co-development. In order to realize the above purpose, one is to rationally adjust the division of central and local tax revenue, and the other is to guide localities to develop advantageous industries in accordance with local conditions and to enhance the function of local financial "blood-forming".

Previously, in 2019, the State Council issued the "Implementation of larger-scale tax cuts and fee reductions after adjusting the reform of the central and local revenue division to promote the program", which has already put forward "to guide localities to develop advantageous industries in accordance with local conditions, and to encourage localities to cultivate and expand the tax source in the economic development, and to enhance the 'blood-creation' function of the local finances". The program has already proposed to "guide localities to develop advantageous industries according to local conditions, encourage localities to cultivate and expand tax sources in economic development, enhance the 'blood-forming' function of local finances, and create an environment of initiative, competitive development, and hard work. Based on the spirit of the opinions of the Central Committee of the Communist Party of China and the State Council, combined with the actual situation of the region, the State has introduced a number of regional tax incentives to help the coordinated development of the region.

(I) Tax Dividend Policies of Guangdong, Hong Kong and Macao Greater Bay Area

The Guangdong-Hong Kong-Macao Greater Bay Area consists of Hong Kong, Macao and nine cities in Guangdong Province, namely Guangzhou, Shenzhen, Zhuhai, Foshan, Zhongshan, Dongguan, Zhaoqing, Jiangmen and Huizhou. The main tax incentives are individual tax incentives: according to the Circular on Preferential Policies on Individual Income Tax in Guangdong, Hong Kong and Macao Greater Bay Area issued by the Ministry of Finance and the State Administration of Taxation, starting from January 1, 2019 to December 31, 2023, high-end talents and talents in short supply from outside the country (including Hong Kong, Macao, and Taiwan, the same hereinafter) who are working in the nine municipalities in the Pearl River Delta (PRD) shall be entitled to the tax already paid by them for the amount of individual income tax paid exceeding the amount of tax calculated based on the taxable income of 15% of the taxable income. The people's governments of the nine municipalities in the PRD will provide financial subsidies for the excess of the tax paid over 15% of the taxable income, which will be exempted from personal income tax.

(II) Tax incentives for Hainan Free Trade Port

In June 2020, the Central Committee of the Communist Party of China ("CPC") and the State Council issued the Overall Scheme for the Construction of Hainan Free Trade Port, establishing the Hainan Free Trade Port. in June 2021, the Law of the People's Republic of China on Hainan Free Trade Port came into effect, elevating the tax arrangements in the Overall Scheme to law and providing rule of law safeguards for the implementation of the tax incentives. According to the Overall Program for the Construction of Hainan Free Trade Port, the implementation scope of Hainan Free Trade Port is the whole island of Hainan, and the tax incentives include enterprise income tax and individual income tax.

The preferential enterprise income tax is: for the enterprises of encouraged industries registered in Hainan Free Trade Port and operating substantially, the enterprise income tax is reduced by 15%; for the tourism industry, modern service industry, high-tech industry enterprises set up in Hainan Free Trade Port, the income obtained from new overseas direct investment is exempted from enterprise income tax.

Individual income tax incentives: for high-end talents and talents in short supply working in the Hainan Free Trade Port, the actual tax burden of their personal income tax exceeds 15% of the part to be exempted, the personal income here includes the comprehensive income from the Hainan Free Trade Port (including wages and salaries, remuneration for services, remuneration, royalties four income), business income and recognized by the Hainan Provincial talent subsidies income.

(III) Tax incentives for the western development region

The scope of the Western Development includes: Chongqing Municipality, Sichuan Province, Guizhou Province, Yunnan Province, Tibet Autonomous Region, Shaanxi Province, Gansu Province, Ningxia Hui Autonomous Region, Qinghai Province, Xinjiang Uygur Autonomous Region, Xinjiang Production and Construction Corps, Inner Mongolia Autonomous Region and Guangxi Zhuang Autonomous Region. In addition, Xiangxi Tujia and Miao Autonomous Prefecture in Hunan Province, Enshi Tujia and Miao Autonomous Prefecture in Hubei Province, and Yanbian Korean Autonomous Prefecture in Jilin Province may implement the enterprise income tax policy in comparison with that of the western regions.

On April 23, 2020, the Ministry of Finance, the State Administration of Taxation and the National Development and Reform Commission issued the Announcement on the Continuation of Enterprise Income Tax Policies for the Development of the Western Region (Announcement of the Ministry of Finance No. 23 of 2020), which states that, from January 1, 2021 to December 31, 2030, the enterprise income tax for enterprises in encouraged industries located in the western region is reduced to a tax rate of 15%. Encouraged industry enterprises refer to those whose main business is based on the industrial projects specified in the Catalogue of Encouraged Industries in Western Region (2020 Edition), and whose main business revenue accounts for more than 60% of the total revenue.

In addition, tax policies for Xinjiang region, Xiong'an New Area, Shenzhen Advance Demonstration Zone of Socialism with Chinese Characteristics, and Chengdu-Chongqing Twin Cities Economic Circle are being studied or have already been introduced to provide precise services to utilize the advantages of the region and achieve coordinated development.

VI. Increase export tax rebates and other policy support to promote the stable development of foreign trade

Although affected by the global epidemic situation, the external environment and other multiple pressures, but China's foreign trade in the year 2022 presents the characteristics of the quantity and quality of the situation to the good, according to the General Administration of Customs data released in 2022, China's total import and export value for the first time exceeded the 40 trillion yuan mark in 2021 on the basis of a high base to continue to maintain a steady growth in the scale of a new record, for six consecutive years to maintain the status of the largest country in trade in goods. the status of the largest country in trade in goods for six consecutive years. Among them, exports were 23.97 trillion yuan, up 10.5%; imports were 18.1 trillion yuan, up 4.3%. Such achievements are attributed to China's policy measures of "stabilizing foreign trade and foreign investment". At present, from the national level to various departments around the introduction of a series of policy measures to stabilize foreign trade and foreign investment, and increase, strengthen and accelerate the export tax rebate is an important part of it.

(I) The State Council issued a document: increase export tax rebates and other policy support

April 13, 2022, Premier Li Keqiang presided over the State Council executive meeting, the deployment of policy initiatives to promote consumption, help stabilize economic fundamentals and protect and improve people's livelihoods, decided to further increase the export tax rebates and other policy support from three aspects, to promote the stable development of foreign trade.

First, the processing trade enterprises in the country after the implementation of export products tax refund rate consistent policy should be refunded not refunded tax amount, allowed to transfer to the input tax credit value-added tax. The export credit insurance compensation obtained by foreign trade enterprises will be regarded as foreign exchange collection and will be processed for tax refund. Expanding the coverage of the departure tax refund policy and implementing the "buy-now-refund" and other facilitation measures.

Second, accelerating the progress of tax refund. Strengthen departmental data sharing, streamline the information required for tax refund, do the declaration, audit, feedback online, this year, the normal tax refund processing time from an average of 7 working days further compressed to 6 working days. Support comprehensive foreign trade service enterprises to centralize tax refund.

Third, continue to optimize the business environment for foreign trade. Improve the efficiency of customs clearance for the return of export goods. Study and formulate policies to support the development of overseas warehouses and facilitate the return and exchange of cross-border e-commerce goods. More convenience will be provided to trustworthy enterprises in customs clearance and tax rebates, and false exports and fraudulent tax rebates will be severely punished in accordance with the law.

(II) Ten departments, including the General Administration of Taxation, have specifically implemented policies to support export tax rebates.

In order to implement the decision of the State Council executive meeting on April 13, 2022 on "deciding to further increase the support of export tax rebates and other policies to promote the stable development of foreign trade", the General Administration of Taxation, the Ministry of Public Security, the Ministry of Finance, the Ministry of Transportation, the Ministry of Commerce, the Ministry of Culture and Tourism, the People's Bank of China, the General Administration of Customs, the Bureau of Foreign Exchange and the China Banking and Insurance Regulatory Commission (CBIRC) and ten departments have targeted three aspects to fully support the development of the foreign trade industry. The ten departments of CIRC have targeted to fully support the development of foreign trade industry from three aspects and increase the support of export tax rebates.

(1) Further increase the support of policies to help enterprises

Increasing the support of policies to help enterprises mainly includes three aspects: First, strengthening the convergence of export credit insurance and export tax rebate policy, enterprises declare the export business of tax rebate, due to the inability to collect foreign exchange and obtain the export credit insurance compensation, the export credit insurance compensation is considered as the collection of foreign exchange, and will be processed for export tax rebate; second, improving the export tax rebate policy for processing trade, in order to support the development of enterprises in processing trade, and to further reduce the burden on enterprises, the tax rebate rate for export products will be adjusted to the level of the export tax rebate rate. In order to support the development of processing trade enterprises and further reduce the burden of enterprises, the enterprises are allowed to transfer the excess VAT input tax due to the inconsistency of the tax collection and refund rates after the tax collection and refund rates of exported products are consistent to allow the enterprises to transfer the input tax to be deducted; the third one is to tap the potential of the departure tax rebate policy. Thirdly, the potential of the departure tax refund policy will be explored. The geographical coverage of the policy on departure tax refund for overseas travelers' shopping will be further expanded.

(2) Further enhance the convenience of tax refund processing

To enhance the convenience of tax refund processing is mainly to vigorously promote "non-contact" processing of export business, i.e. to optimize the promotion of international trade "Single Window", Electronic Taxation Bureau and other information systems, and to actively support and guide export enterprises to adopt "non-contact" mode of port processing. This means optimizing and promoting information systems such as the "Single Window" for international trade and the Electronic Taxation Bureau, and actively supporting and guiding export enterprises to use "non-contact" methods to handle business at ports and in the cross-border trade area. In addition, it also includes continuing to streamline the information submitted in the export tax rebate process; strengthening data sharing and convergence management among customs, tax and other departments; actively promoting the electronic filing of documents for export tax rebate filing; significantly enhancing the level of intelligent declaration for export tax rebate; continuously improving the quality and efficiency of export tax rebate processing; further improving the efficiency of customs clearance of exported goods for return shipment; and optimizing and streamlining the process of export tax rebate matters and other specific measures.

(3) Further optimizing the business environment for export enterprises

Optimizing the business environment for export enterprises is mainly achieved by enriching publicity channels and precise reminder contents, so that export enterprises can be informed of the progress of customs declaration, customs clearance, tax refund and other matters in a timely manner, guiding enterprises to improve the efficiency of their internal management, further compressing the time for collection and circulation of export documents, and accelerating the declaration of export tax rebates, etc. It also includes supporting the healthy and sustainable innovative development of cross-border e-commerce; guiding the healthy growth of foreign trade comprehensive service enterprises ; strengthen information sharing to guide enterprises to operate in good faith; and actively create a fair and just business environment and many other dividend policies in parallel.

These policies and measures, in helping enterprises to tide over the difficult times, to retain the main body of the market to play a positive role, at the same time, will further stimulate the vitality of the main body of the market, optimize the business environment for foreign trade, is conducive to promoting foreign trade and foreign investment in a stable and progressive, to help stabilize the growth of the economy.