China’s Hainan boosts supervision of free-trade port to prevent island becoming ‘tax haven’
- Governor Feng Fei says Hainan will strengthen supervision of business registration and operations to keep bad players out
- Province reduced income tax rate for selected individuals and companies to 15 per cent last June, far lower than the mainland
Hainan is tightening supervision of its business environment to ensure the tropical island does not become a tax haven, after Beijing outlined plans to turn it into a free-trade port that might one day rival Hong Kong and Singapore.
To attract talent and financing, the island province of 9.5 million people reduced its income tax rate for selected individuals and companies to 15 per cent, far lower than the mainland and closer to the average 17 per cent level in Hong Kong.
But on Monday, provincial governor Feng Fei said Hainan would tighten supervision of business registration and operations to ensure entities could not take “undue advantage of loopholes”.
We will not let a single shell company in
“We will not let Hainan free-trade port become a tax haven,” he told a media briefing organised by the State Council Information Office.
Since Hainan was announced as a free-trade port last June, business registrations on the island have skyrocketed.