Guangdong Looks to Cut Costs for Manufacturing Sector
27 September 2017
Guangdong has recently announced a number of new measures designed to cut the costs of the province’s manufacturing base. Among the proposals are urban land use tax cuts and a reduction in the tax payable on commercial vehicles and vessels to the lowest statutory level. With regards to corporate land use, the measures include allowing land-intensive manufacturing projects (within those industries designated for priority development by the provincial government) to pay land transfer fees of just 70% of the minimum industrial use price for the corresponding grade of land at the project’s existing location.
In terms of social insurance, steps are to be taken to unify the enterprise pension insurance premium contribution rates of all employing units at the 14% level. This will see all districts with an excessively high balance in their employees’ medical insurance fund entitled to reduce their unit contribution rate in order to align with the required level. In addition, any district with a nine-month surplus in its maternity insurance fund may reduce its maternity insurance premium rate to 0.5% of the total payroll. In case of any districts that have already reduced their premium rate to 0.5%, they may initiate a further cut to 0.45%. Among the additional measures proposed is a lowering of the overall financing and institutional transaction costs of businesses within the region.
For further details (in Chinese), please refer to the following website:
Circular of the Guangdong Provincial People’s Government on Issuing Several Policy Measures for Lowering the Cost of Manufacturing Enterprises and Supporting the Development of the Real Economy (Yue Fu No. 90 )