China introduces benefits for the IT sector

China introduces benefits for the IT sector

The People’s Republic of China is actively developing the IT sector. The State Council of the People’s Republic of China adopted a number of amendments to the tax policy regarding IT companies. The innovations will affect companies that produce integrated circuits and software.

The main points of the changes:

• Companies that develop 28nm chips or less, with a lifespan of 15 years or more, will be eligible for a corporate tax exemption for the next 10 years.
• The organization that develops 65 nm process chips will be exempted from paying corporate tax for the next 5 years, and the next 5 years will pay it at a rate of 50%.
• Companies developing chips for 130 nm or less are exempt from corporate tax for the next 2 years, and the next 3 years will pay it at a rate of 50%.
• For organizations that are engaged in the development of 130 nm chips and less, the loss carryover period has been extended by 10 years.
• Companies that are engaged in the design of integrated circuits, equipment, materials, software development, etc. also exempt from corporate tax for the next 2 years, and then 3 years will pay it at a rate of 50%.

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