Guide To Chinese Industrial Zones 2009-04-09

Incentives and Restrictions for Industrial Zones by Type Economic &  Technological 

High­Tech Industrial  Free Trade Zones  Development Zones  (FTZ) 

Development  Zones (ETDZ) 

(HIDZ) 

Corporate Income  15% instead of 25%

Export Processing  Zones (EPZ)

Same

Same

Same

Same Corporate Income  For enterprises whose export ratio is Tax Rate (For  more than 70% in export oriented  each fiscal year corporate income tax enterprises)  will be 10%, instead of 15%

Same

Same

Custom Duty & 

Custom duty and VAT exempted for Value Added Tax  encouraged (VAT) (on self­use  industries. equipment and  spare parts) 

Custom duty and VAT exempted for encouraged industries.

Exempted

Exempted

Custom Duty and  Only enterprises involved in the VAT (on raw  processing trade are materials and  exempted. parts) 

Only enterprises involved in the processing trade are exempted.

Exempted

Exempted

VAT Tax Rate 

Same

Same

Same

Tax Rate (For high  tech enterprises) 

17%

VAT Rate Licences  For enterprises in the category of for equipment,  encouraged raw materials and  industries, licenses office equipment  are exempted.

For enterprises in the Licenses not required category of encouraged for all processing industries, licenses are trade enterprises exempted.

Licenses not required for all processing trade enterprises

(for processing  enterprises)  Tax on finished  products using  duty­free raw 

Levy on finished products

Levy on finished products

Levy on imported raw Levy on finished materials and parts products only

materials.  VAT will be refunded VAT will be refunded VAT Refund for  following export of following export of finished products  shipment shipment using domestic  raw materials.  Ratio Between  Export and  Domestic Sales. 

No restriction as long as projects are excluded from export license and quota management.

No restriction as long as projects are excluded from export license and quota management.

VAT will be refunded following export of shipment

No restriction

Immediate VAT refund for domestic raw materials upon entering the zone Exact percentage varies between zones

Economic & 

High­Tech Industrial  Free Trade Zones 

Export Processing 

Technological  Development 

Development Zones  (FTZ)  (HIDZ) 

Zones (EPZ)

Unrestricted

Unrestricted

Only by a transport company licensed in the zone and registered with customs

Only by a transport company licensed in the zone and registered with customs

Not applicable

Not applicable

Bonded warehouse receiving register (EDI with the customs house)

Export processing zone border crossing cargo record statement (EDI with the customs house)

Zones (ETDZ)  Transport of  products in the  zone Bonded cargo  control