In recent years, the government has made consistent efforts to improve the competence of the country’s business environment by introducing policy measures to cut red tape and bring down taxes and fees.
Streamline administration and cut fees to ease enterprises’ burden
The 16th meeting of the Central Leading Group for Financial and Economic Affairs decided to streamline and reduce various inspections and penalties for enterprises, and establish a list of enterprise-related charges to regulate business-related charges and relieve enterprises’ burden.
Since May 1, 2016, China has extended the trial program of replacing business tax with value-added tax (VAT) to the whole nation, which has fully covered all industries of national economy. Statistics from Zhejiang province show that after a year of the comprehensive implementation of VAT pilot program, a total of 46.49 billion yuan ($7.01 billion) in taxes has been reduced, covering 98 percent of the province’s pilot taxpayers.
And figures showed that the government reduced 56.50 billion yuan of operation and service charges for enterprises in 2016, and extended the exemptions of 18 administrative charges from small and micro businesses to all enterprises and individuals.
Moreover, the State Council executive meeting on April 19 announced another six measures to cut taxes for businesses. It is expected that the total tax reduction will amount to more than 380 billion yuan this year.
Revise laws and regulations to further attract foreign investment
The 16th meeting of the Central Leading Group for Financial and Economic Affairs also decided to develop new laws on foreign investment, streamline laws, regulations and policies related to foreign investment to offer equal and national treatment for foreign enterprises after their establishment.
And the latest revised Catalog for the Guidance of Foreign Investment Industries (2017) has elevated the country’s opening up to a new high level, making China’s business environment more attractive to foreign investors.
A senior official from the National Development and Reform Commission said that the new version of the catalog has further reduced restrictions for foreign investors, and put forward a negative list to regulate and relax market access.
With these efforts, China’s business environment has seen notable improvement and remained one of the most attractive destinations for foreign investors. And the Doing Business 2017 ranking issued by the World Bank moved China up by 18 spots in terms of the ease of doing business in the past three years.