Li Keqiang presides over the State Council executive meeting to deploy the promotion of innovation and upgrading in national level economic and technological development zones

Li Keqiang presides over the State Council executive meeting 
Deploying and promoting innovation and upgrading in national level economic and technological development zones to create a new highland for reform and opening up
Decided to continue the preferential income tax policies for integrated circuit and software enterprises to attract more domestic and foreign investment and promote the development of the information industry

   On May 8th, Premier Li Keqiang presided over a State Council executive meeting to deploy the promotion of innovation and upgrading in national level economic and technological development zones, and to create a new highland for reform and opening up; Decided to continue the preferential income tax policies for integrated circuit and software enterprises, attract more domestic and foreign investment, and promote the development of the information industry.
   The meeting pointed out that there are currently 219 national level economic development zones in China, with GDP and fiscal revenue accounting for about 10% of the country's total, and import and export trade and utilization of foreign capital accounting for about 20%. The growth rate of major indicators exceeds the national average, and there is still great new potential to be released. We must implement the deployment of the Party Central Committee and the State Council, accelerate the opening and innovation, scientific and technological innovation, and institutional innovation of national level economic development zones, stimulate market vitality, and give full play to their advantages in cultivating new drivers of economic growth and promoting high-quality development. We must support the optimization of the business environment in the Economic Development Zone and promote it to be at the forefront of the "streamlining administration, delegating powers, and improving services" reform. Simplify investment project approval, implement vacancy approval, and implement a commitment system. Incorporate investment results into the assessment and incentives of the Economic Development Zone. Provide convenience for entrepreneurs and innovators in registered residence, children's enrollment, venture capital, etc. Each region should take the initiative to empower the Economic Development Zone with greater reform autonomy, unleash vitality, and ensure fairness. Secondly, we must promote innovative development. The Economic Development Zone should take the lead in implementing national science and technology innovation policies, and for those with significant results, it can increase the efforts to pilot policies first. Support the construction of national large-scale scientific experimental facilities and national science and technology innovation bases. The income from the transformation of job-related invention achievements by the research institute of the district will be given as cash rewards to the scientific and technological personnel who participate in the research and development. Those who meet the requirements can be reduced by 50% and included in the personal income tax on salary and wage income. Increase support for the joint construction of talent training bases between economic development zones and vocational colleges. Thirdly, we need to enhance the level of openness. Support the introduction of private capital and foreign investment to develop and operate characteristic industrial parks in the Economic Development Zone, and encourage Hong Kong, Macao, and foreign institutions, enterprises, and capital to participate in the operation of international cooperation parks. Support the establishment of comprehensive bonded zones. Support pilot projects such as capital project revenue and expenditure facilitation in economic development zones where conditions permit. Fourth, we must promote industrial upgrading. National major industrial projects are prioritized for layout within the district. Implement the action of cultivating advanced manufacturing clusters and optimizing and upgrading modern service industries. Promote the level of innovation and entrepreneurship. Encourage various types of capital investment to develop the digital economy.
   The meeting pointed out that the integrated circuit and software industries are strategic, fundamental, and leading industries that support economic and social development. By treating all types of ownership enterprises, including foreign-funded enterprises, established in China equally and implementing inclusive tax and fee reductions, attracting various types of investment to participate and promote the development of integrated circuits and software industries, it is conducive to promoting the optimization and upgrading of the economic structure and better meeting the needs of high-quality development and high-quality living. The meeting decided to continue implementing the preferential policy of "two exemptions and three reductions in income tax" for integrated circuit design and software enterprises, as specified in the 2011 "Notice of the State Council on Issuing Several Policies to Further Encourage the Development of the Software Industry and Integrated Circuit Industry", on the basis of implementing the "two exemptions and three reductions in enterprise income tax" (i.e. exemption from the first to second year and halving from the third to fifth year) or "five exemptions and five reductions in income tax" (i.e. exemption from the first to fifth year and halving from the sixth to tenth year) for integrated circuit production enterprises or projects under different conditions according to regulations. The 2018 income tax settlement and payment shall also be carried out in accordance with the above regulations. At the same time, relevant departments should urgently study and improve support policies to promote the development of integrated circuits and software industries to a higher level in the next step.
   The meeting also discussed other matters.

Information source: China Government website