Taxation policy

(1) Goods related to production entering Pingtan from outside the Chinese mainland will be duty-free or kept bonded, except for goods imported for consumption and commercial real estate development, as well as those shall not be bonded or duty-free in accordance with laws, regulations and relevant stipulations.

Goods entering the mainland via Pingtan shall go through customs formalities in accordance with relevant regulations. Customs duties shall be levied in accordance with the actual examination reports, except for those goods for individual consumption that remitted taxes at "level 1".

Goods related to production entering Pingtan from the mainland are considered equal to those for export and shall enjoy tax rebates in accordance with regulations, except for those purchased for individual consumption and commercial real estate development. Those goods shall not enjoy tax rebates in accordance with laws, regulations and relevant stipulations.

Pingtan enterprises selling duty-free and bonded goods (including those manufactured by duty-free and bonded materials) to individuals shall fulfill the duties in accordance with regulations. The lists of goods that shall not be tax-free or bonded at "level 1" and goods that shall not enjoy tax rebates at “level 2” shall be approved by the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs.

(2) Goods produced and processed by Pingtan-based enterprises and sold to the mainland through "level 2" customs clearance formalities shall be levied a value-added tax and consumption tax for import in accordance with relevant regulations.

Based on enterprise applications, trial operations for levying tariffs on goods shall be carried out in accordance with the corresponding materials or actual examination reports. The measures will be improved continuously through trial operations before final implementation.

(3) Trade of goods amongst Pingtan-based enterprises is exempt from the value-added tax and consumption tax.

(4) On the basis of industrial access and preferential policies, a 15 percent business income tax will be levied on eligible enterprises.

(5) Pingtan-registered shipping enterprises are exempt from business tax on income generated in shipping business between Pingtan and Taiwan; Pingtan-registered insurance companies are exempt from business tax on income generated in providing international shipping insurance services for Pingtan-registered enterprises; Pingtan-registered enterprises are exempt from business tax on income generated in outsourced offshore services; Pingtan-registered eligible modern logistics enterprises enjoy the policy of differentiated business taxes; active research and preferential policies for finance lease enterprises and trial operation can be introduced when conditions permit.

(6) The Fujian Provincial People's Government will temporarily provide subsidies for personal income tax for Taiwan residents working in Pingtan on the basis of the difference between personal income taxes between the Chinese mainland and Taiwan. The foresaid subsidies are exempt from personal income tax.

(7) Given the precondition that an exit port is opened in Pingtan, duty-free shops can be established in accordance with current regulations. Based on the current Dadeng Trading Market of Petty Commodities for mainland customers, a new market for petty commodities from Taiwan will be built with government support.