Changchun Implements Tax Incentives and Optimizes Services for Key Enterprises and Projects

Updated : 2024-04-25Source : CCFAO
【Fonts: A+ A A- Print
Changchun Municipal Tax Service, State Taxation Administration has been focusing on its core responsibilities and coordinating tax revenue collection while precisely implementing tax reduction policies to provide comprehensive services for the revitalization and development of Changchun.
Today, during the 33rd Tax Propaganda Month, we highlight the tax incentives and measures designed to support new quality productive forces.
I. Major Tax Incentives for New Quality Productive Forces
The tax authorities use tax incentives to guide enterprises toward independent innovation. The major tax incentives for the development of new quality productive forces focus on supporting scientific research and commercialization of technological achievements, investment in scientific and technological innovation, and growth of the manufacturing industry, as well as implementing talent cultivation and incentive programs, covering the innovation chain, industry chain, capital chain, talent chain, etc.
(I) Promoting scientific research and commercialization of technological achievements. For research and experimental development, enterprises can enjoy a 100% weighted deduction on R&D expenses and a pre-tax deduction on basic research investments. For the commercialization of technological achievements, VAT (value-added tax) exemptions are applied to technology transfer, technology development, and related technical consulting and services. Corporate income tax relief is also granted for technology transfer income. To encourage incubation, high-tech business incubators, university science parks, and mass innovation spaces are exempt from property tax and urban land use tax, and their revenue is exempt from VAT. For rates, high-tech enterprises and technologically advanced service enterprises enjoy a reduced corporate income tax rate of 15%, a 10-percentage-point reduction from the standard rate.
(II) Encouraging investment in scientific and technological innovation. This mainly involves offsetting taxable income based on the investment proportion. If legal partners in corporate venture capital enterprises and partnership venture capital enterprises invest in startup technology-based enterprises or small and medium-sized high-tech enterprises, and if individual partners and angel investors in limited partnership venture capital enterprises invest in startup technology-based enterprises, the taxable income of the investment enterprises and the investors can be deducted according to 70% of the investment amount.
(III) Supporting manufacturing industrial growth. The main focus is on VAT incentives, including VAT credit refunds for manufacturing, scientific research, and technology service industries. Integrated circuit enterprises and industrial machine tools are eligible for a 120% weighted deduction on R&D expenses, while industrial machine tool enterprises and advanced manufacturing enterprises can enjoy additional VAT credits. Furthermore, newly purchased equipment and appliances are subject to a pre-tax deduction and accelerated depreciation of fixed assets.
(IV) Supporting talent cultivation and personal incentives. At the corporate level, the tax-deductible proportion for employee education costs has been increased from 2.5% to 8%, encouraging enterprises to invest in talent cultivation. At the individual level, incentives are provided through measures such as tax deferrals, installment payment, or tax reductions. Individuals who invest in shares through technological achievements can defer their tax obligations, meaning that taxes can be paid when dividends are received or shares are transferred. High-tech enterprise technicians can pay taxes on equity rewards in installments. Cash rewards for the commercialization of work-related technological achievements are taxed at half the standard rate, and equity rewards can be subject to tax deferrals. Additionally, personal income tax is exempted on scientific bonuses given to technicians.
II. Major Measures for Implementing Tax Incentives for New Quality Productive Forces
Changchun Municipal Tax Service, State Taxation Administration is vigorously driving the effective implementation of tax incentives and reinforcing the additive effect resulting from the positive chain where "policy benefits empowering — increased R&D investment — product quality enhancement — accelerated industrial growth — flourishing new quality productive forces".
Specific measures are as follows:
(I) Accurately implementing tax incentives. Firstly, we will implement a "proactive policy outreach" approach by utilizing tax big data to accurately profile taxpayers and distinguish between enterprises and policy types. We will improve various "policy packages" and directly deliver policies to business entities on a "point-to-point" basis. Secondly, we will provide personalized "one-on-one" guidance to address any issues related to eligibility for tax benefits or difficulties in accessing preferential tax policies. This will help enterprises better understand and benefit from the policies. Thirdly, we will assist enterprises in preventing tax risks by identifying risks for taxpayers applying for preferential policies and alerting those with potential risks. Taxpayers who have accessed benefits in error can correct their submissions, ensuring accurate policy implementation.
(II) Optimizing services for key enterprises and projects. Firstly, direct connection services for key and complex issues will be launched to optimize the tax manager liaison mechanism, where dedicated personnel will be assigned to handle special tasks. This will involve a coordination mechanism for complex tax-related matters of key tax-source enterprises and major project enterprises. Additionally, a quick response mechanism will be refined to promptly resolve tax-related issues following the principles of "ledger management, categorized division, direct response by dedicated personnel, and cancellation of accounts". Furthermore, a specialized task force will actively serve the construction of the Beihu Future Science City and provide tax support for the rapid development of strategic emerging industries. Secondly, a "full-cycle service" will be developed for enterprises to be listed, including policy assistance, financial "health examination", and tax consulting for enterprises to be listed. By creating a comprehensive service scenario that integrates "tax policies + warm reminders + tax service guidance", we aim to support the growth and expansion of enterprises to be listed. Thirdly, "escort services" based on precise analysis will be conducted. This involves providing in-depth policy interpretation, industrial trend analysis, internal control assessments, and tax-related risk evaluations for key tax-source enterprises and major project enterprises, with multi-dimensional and full-process tax-related solutions, to ensure the healthy operation and growth of enterprises.
(III) Continuously optimizing tax payment services. Firstly, we will implement a list-based approach to tax services by establishing tax service lists such as the Non-contact Tax Payment Items List and the "SRDI" Enterprise Work List under the "Three Dedicated Measures and Three Systems" Service Model. This will help improve the "efficiency-oriented" working mechanism to promote better tax service processes, simpler documentation, lower costs, faster speed, and higher efficiency. Secondly, we will build an intelligent and convenient service system, expand the range of full-course online tax services, and introduce intelligent approval for some high-frequency businesses. We will also prioritize remote assistance by creating a three-dimensional intelligent tax service model of "Intelligent Tax Service Center + Physical Tax Service Hall + Intelligent Assistance". Thirdly, we will strive to achieve transformation and upgrade of the tax service hall. By leveraging the "Jincheng Studio" and the "Jincheng Tax Service Team", we will shift our focus from "tax payment-oriented services" to "responding to the personalized demands of taxpayers, handling complex tax payment matters, resolving tax disputes, and meeting individual service demands". We will also move some basic management tasks to the front-end service departments to achieve integrated and centralized processing, and optimize the regional layout of the tax service hall by gradually reducing physical service windows and expanding self-service options, to enhance the satisfaction and sense of gain of taxpayers.
Q&A Meeting with Reporters
[Changchun Daily] Q: Tax and fee cuts are important measures to support enterprise development and scientific and technological innovation. Can you elaborate on how Changchun has implemented these policies and supported innovation in recent years?
[Cong Dequan, Director of Policy and Regulations Division, Changchun Municipal Tax Service, State Taxation Administration] A: Tax and fee cuts are the most direct, effective, and equitable policies to benefit enterprises. The state has implemented large-scale tax and fee cuts for several consecutive years to support enterprises in overcoming difficulties, energize market players, and promote economic transformation and upgrading.
We have established a working mechanism led by the government, with taxation as the primary focus and collaboration among departments, to vigorously promote the precise implementation of preferential policies. Since 2021, we have achieved tax and fee cuts, tax rebates, and tax deferrals totaling RMB 46.8 billion.
Specifically, in terms of supporting the development of manufacturing and other industries, 19,800 taxpayers have benefited from VAT credit refunds totaling RMB 27.834 billion. Additionally, 371 taxpayers have benefited from additional VAT credits for the advanced manufacturing industry, totaling RMB 2.315 billion, and 1,130 taxpayers have benefited from one-time tax-deductible expenses for new equipment and appliances, totaling RMB 3.709 billion;
In terms of supporting high-tech enterprises and basic research, 837 taxpayers have benefited from high-tech enterprise tax incentives totaling RMB 14.604 billion. Institutions such as Jilin University, Changchun Technical University of Automobile, Changchun Polytechnic, and Changchun Institute of Applied Chemistry of the Chinese Academy of Sciences have received VAT refunds for purchasing domestic equipment, totaling over RMB 57 million;
In terms of encouraging enterprise investment in R&D, a total of 5,215 taxpayers received weighted deductions on R&D expenses totaling RMB 9 billion for the years 2021 and 2022. From the first to third quarters of 2023, 1,245 taxpayers received weighted deductions on R&D expenses totaling RMB 7.295 billion. The annual data will be released after the corporate income tax settlement at the end of May.
[Keep Watch] Q: What measures have tax authorities taken to support the development of "specialized, refined, differential, and innovative" enterprises?
[Du Jianjun, Director of Tax Services Division, Changchun Municipal Tax Service, State Taxation Administration] A: "SRDI" enterprises possess unique skills and play a key role in promoting new industrialization and fostering new quality productive forces. In recent years, we have continuously improved specialized tax services for "SRDI" enterprises to better support their growth.
Firstly, we offer tailored services through "three dedicated measures and three systems". For all "SRDI" and "Little Giant" enterprises in Changchun, we have designed a model of "one expert for one enterprise, one dedicated file for one enterprise, and one personalized strategy for one enterprise". This involves forming 18 "tax support teams" for "SRDI" enterprises, with each enterprise assigned a "chief tax officer" to provide one-on-one expert service. We also establish a dedicated growth file for each enterprise to record its business status, applicable tax incentives, matching services, etc., constituting the "one dedicated file for one enterprise" service. Additionally, we offer tax policy updates and risk alerts based on industry characteristics and business operations, achieving the "one personalized strategy for one enterprise" service. We have established a sound "three-system" guarantee mechanism of "three-tiered responsibility for research and investigation, immediate handling of demands, and division of responsibilities", whereby the heads of tax bureaus in each county and district, members of the leadership team, and leaders of tax source management departments are responsible for guaranteeing "SRDI" enterprises at the national, provincial, and municipal levels, respectively. We have conducted regular research visits to address tax-related challenges in a timely manner.
Secondly, we provide tangible tax incentives to enterprises by taking well-targeted steps. We have established an "SRDI" enterprise tax service platform and invited enterprises to join with real-name authentication. This platform enables the accurate dissemination of tax policies, instant responses to queries, and remote guidance on tax matters. From 2023 to the first quarter of 2024, we conducted 820 online training sessions, pushed 342 batches of preferential tax policies totaling 29,300 items, and offered 850 tax-related suggestions to 29 "SRDI" enterprises to be listed or with listing intention. As a result, all "SRDI" and "Little Giant" enterprises in Changchun received RMB 6.87 billion in tax incentives, and 214 enterprises obtained RMB 442 million in financing credits.
Lastly, we address urgent and difficult tax demands by handling special cases with special methods. We have established a "153 special case handling" time-bound system, analyzing tax-related demands within one working day, completing them within five working days, and providing feedback within three working days. We have assigned dedicated personnel to track the entire process, conduct follow-ups, and find and address issues promptly. So far, we have handled 123 personalized tax demands from "SRDI" enterprises within the prescribed time limit, and have received highly positive feedback from the enterprises involved.
[CMG] A: Changchun is currently advancing investment in and construction of a series of major projects. What role does the tax bureau play as an economic department in this effort?
[Cong Dequan, Director of Policy and Regulations Division, Changchun Municipal Tax Service, State Taxation Administration] A: Major projects are the "cornerstone" that stabilizes the economy and the "engine" that drives economic growth. Taxation plays a critical role in supporting major enterprise development and key project investment by providing comprehensive follow-up and support throughout the entire cycle. Our bureau has always prioritized this work.
Here's an example of our service in support of the Beihu Future Science City. The Future Science City serves as a practical platform and innovative driver for Changchun to lead industrial innovation with technological innovation and accelerate the development of new quality productive forces. Our bureau has actively fulfilled its tax responsibilities to expedite the effective construction of the Future Science City.
Firstly, we establish a dedicated task force. Focusing on precise coordination, meticulous services, and thoughtful assistance, both the municipal and district tax authorities have set up dedicated task forces and established mechanisms for work coordination and information sharing with relevant departments. We have conducted direct connections with key projects and enterprises, tracked the construction progress of the Science City in time, implemented tax incentives, and offered VAT services.
Secondly, we form a youth shock brigade. Relying on the "Jincheng Studio" service team, we have established a "Tax Benefiting Beihu" youth shock brigade with over 30 backbone business officials from the authorities at municipal and district levels. The Changchun New Area Tax Bureau and the Economic and Technological Development Zone Tax Bureau have established direct connections with the respective development zone authorities, with a focus on tax issues and other urgent concerns related to the Beihu Future Science City. This enables quick responses, rapid processing, and immediate resolution of issues, ensuring the smooth implementation of key economic projects in the region.
Thirdly, we work to implement tax incentives. Our bureau has compiled the Compilation of Tax Incentives Supporting Beihu Future Science City Construction and a "Tax Inquiry Service Card", specifying the contact department, person, and information for each step of business handling. On April 18, we held a seminar on "Tax Incentives for Scientific and Technological Innovation, Empowering High-Quality Development" for some project stakeholders in the Beihu Future Science City, aiming to understand enterprise needs, explain preferential policies, address tax-related demands, and mitigate tax-related risks, thereby promoting the successful advancement of projects in the Beihu Future Science City.