Tax breaks resume for foreigners' capital goods imports
The mainland is to restore a tariff exemption for capital goods imported by foreign investors in selected industries and sectors.
Beijing said yesterday the move, effective tomorrow, was aimed at boosting flagging foreign investment.
Minister of Foreign Trade and Economic Co-operation Wu Yi said the tax breaks would also apply to domestic firms on imports of capital goods, the Xinhua news agency reported.
Ms Wu said exemptions from value-added tax and custom tariffs had been lifted for high-technology products and other projects encouraged by the central government.
However, she said taxes would continue to be levied upon imports of certain low-technology machinery and equipment as well as on imports that it was decided posed a threat to fledgling domestic industries.
The decision to scrap the tax exemption in April last year triggered an outcry from foreign investors, who faced increased tariffs of up to 40 per cent on imports.
The ruling was partly blamed for a 27 per cent drop in promised foreign investment during the first 11 months of this year.
Ms Wu said the tax exemptions would apply to foreign investment in new agricultural technology and projects in energy, transport and important raw materials.
They would also apply to projects that would increase exports, open up new markets and help the environment.
Ms Wu said further details on the tariffs would be announced today.
