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Policies improve people's livelihoods in 2020

Updated: Dec 28,2020 10:34 AM    chinadaily.com.cn

In 2020, the government unveiled several policies, such as lowering import tariffs, deferring income tax payments, and cutting taxes and fees, in order to stabilize employment, promote consumption and improve people's livelihoods. 

Aerial photo taken on Dec 7, 2020 shows containers stacked at the container terminal of the Lianyungang Port in Lianyungang city, East China's Jiangsu province. [Photo/Xinhua]

— Lowering import tariffs for some products

China implemented provisional import tax rates that are lower than the most-favored-nation tariff rates for over 850 commodities starting Jan 1, according to a circular on the adjustments of import tariffs issued by the Customs Tariff Commission of the State Council.

Under the circular, China introduces or reduces the provisional import tax rates on products including frozen pork, frozen avocados and nonfrozen orange juice, as well as imposes zero import tax on pharmaceutical products containing alkaloids for asthma treatment and raw materials for the production of new diabetes medicines.

People shop at a duty-free store in Haikou, capital of South China's Hainan province, Nov 10, 2020. [Photo/Xinhua]

— Raising duty-free shopping quota

Starting July 1, Hainan has increased its annual tax-free shopping quota from 30,000 yuan ($4,584) to 100,000 yuan per person each year.

The categories of duty-free goods have also been expanded from 38 to 45, with some electronic products such as mobile phones and laptops added to the duty-free list.

A clerk counts cash at a bank in Huaibei, Anhui province. [Photo provided to China Daily]

— Deferring income tax payment

China will defer income tax payments for small companies with thin profit margins, as well as individually owned businesses, to help them resume business and production, said the State Taxation Administration.

Small companies with thin profit margins are allowed to suspend payments of corporate income tax from May 1 to Dec 31 this year until the first filing period in 2021, once they complete required filing procedures, according to a statement published on May 29.

Individual business owners can delay payments of individual income tax incurred in the same period until the first filing period next year, the statement said.

The previous tax-free limit of 8,000 yuan for a single product has been lifted, and the number of categories with a single-purchase quantity limit has been significantly reduced.

A merchant shows a banner written "business booming" at her shop in the Yiwu International Trade Market in Yiwu, East China's Zhejiang province, Feb 18, 2020. [Photo/Xinhua]

— Efforts to stabilize employment

Chinese authorities on July 16 released a circular aimed at supporting small stores as part of efforts to increase employment, expand consumption and improve people's livelihoods.

The circular, jointly issued by the Ministry of Commerce and six other government departments, detailed measures to develop 1,000 clusters of small stores nationwide by 2025.

E-commerce platforms, logistics firms, trading enterprises and central kitchens are encouraged to cooperate with small stores to reduce their costs, according to the circular.

Customers take a break at Element in Shanghai, which sells clothing, shoes, handbags, perfume and household supplies. [Photo/China Daily]

— Easing rental burdens for small businesses

On May 9, China announced rental reductions or exemptions for small and self-employed businesses in the service sector, which were reeling from weak consumer spending during the COVID-19 pandemic.

The rent relief aims to support hard-hit micro and small companies and self-employed businesses, especially in the sectors of catering, accommodation, tourism, education, housekeeping, theater and hairdressing.

People visit the 14th Hainan Autumn Auto Show in Hainan International Conference and Exhibition Center in Haikou, capital of South China's Hainan province, Sept 17, 2020. [Photo/Xinhua]

— Spurring auto consumption

Chinese authorities unveiled a slew of measures to stabilize and expand car consumption, amid efforts to ensure the stable and normal operation of the economy, said an official circular on April 29.

Financial institutions will be encouraged to conduct financial business including auto consumption credits, said the circular, stressing good use of consumer auto financing.

More efforts will be made to increase support for personal auto consumption credits and further release the auto consumption potential by appropriately lowering the down payment ratio and loan interest rate as well as extending the repayment period, the circular noted.

Employees check medicines before they are packed at a pharmaceutical company in Nanyang, Henan province, in February. [Photo/Xinhua]

— 97 drugs of new medical insurance catalog available for purchase

A total of 97 drugs, including 70 new additions and 27 renewed drugs, were approved to be included in China's new national medical insurance catalog after price negotiations between the healthcare security administration and drug producers.

A driver charges his new energy vehicle in Weifang, Shandong province. [Photo by Wang Jilin/For China Daily]

— More support for NEV industry

On April 23, China announced it will extend tax exemptions on new-energy vehicle (NEV) purchases by an additional two years to better promote the sector's development and boost car sales.

The tax exemptions, which were set to expire at the end of this year, will continue from Jan 1, 2021 until Dec 31, 2022, for electric, plug-in hybrid and fuel cell-powered vehicles, according to a statement jointly issued by the Ministry of Finance, State Taxation Administration and Ministry of Industry and Information Technology.

Meanwhile, value-added taxes on the sale of old vehicles by second-hand vehicle dealers will be decreased to 0.5 percent of the sales volume from May 1 to the end of 2023.

A taxpayer in Baokang county, Hubei province, enquires about filing procedures at the local tax office. [Photo by Yang Tao/for China Daily]

— Tax relief policies

A State Council executive meeting on Feb 25 decided to exempt value-added taxes for small-scale taxpayers in Hubei province, which was hit hard by the novel coronavirus earlier this year, and cut taxes from 3 percent to 1 percent for those outside Hubei from March 1 to May 31.

Individual businesses will also see a cut in their insurance contributions. Industrial and commercial companies not from high energy-consuming industries enjoy a 5-percent cut in electrical charges.

A tractor hauls the parcels from the cross-border e-commerce businesses to the parking apron at the Changsha Huanghua International Airport in Changsha, Hunan province, on May 28, 2020. [Photo/Xinhua]

— Stabilizing foreign trade, investment

In April, the State Council decided to set up 46 new, comprehensive cross-border e-commerce pilot zones, bringing the total number to 105.

In addition to applying the practices proven effective in boosting the flow of commerce, firms in these zones enjoy such supportive policies as the exemption of value-added and consumption taxes on retail exports, and assessed levies of the corporate income tax.

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