Article 1: These regulations are formulated to accelerate the development of an export-oriented economy and attract foreign investment in China.

Article 2: These regulations apply to Sino-foreign joint ventures, Sino-foreign cooperative ventures, foreign-invested enterprises and other public welfare undertakings established by foreign companies, enterprises and other economic organizations or individuals within the territory of Ordos municipality.

Article 3: Foreign-invested enterprises shall be exempt from business income tax for the first two years of profitable operation. For the third, fourth and fifth years, the enterprise income tax shall be halved. From the sixth years to the tenth year, the income tax shall be paid in accordance with the income tax rate stipulated by the state, but, if that rate exceeds 22 percent, the local financial department shall refund tax paid in excess of that rate.

Article 4: Encourage foreign-invested enterprises with large investment.

(1)An industry encouraged by the state's industrial policies, with foreign investment of over $3 million and operating for more than ten years, and approved by the financial and tax authorities, may enjoy the relevant open-city tax treatment.

(2)Foreign-invested enterprises with investment of $5 million, operating for more than ten years, as well as foreign-invested enterprises engaged in service industries, shall be entitled to refund by the local financial department of 50 percent of business income tax paid from and including the first profit-making year.

Article 5: Foreign-invested enterprises that reinvest realized profits (including tax relief or refunds) into export commodities and expand export sources shall be exempted from business income tax related to the commodities exported and sold, and the Value-Added Tax (VAT) shall be subject to a zero tax rate. Those products designated as taxable consumer goods shall be exempted from consumption tax. After the expiration of the foreign-invested enterprise business income tax exemption, income tax shall be halved for such enterprises with a value of export output exceeding 70 percent of the such enterprises’ gross domestic sales.

Article 6: After the expiration of duty-free status and tax breaks, enterprises engaged in agriculture, animal husbandry and development and management of forests shall, for each of the subsequent ten years, be subject to a reduction of 30 percent of business income tax after approval by the financial and tax authorities.

Article 7: Foreign-invested enterprises shall be exempt from local income tax.

Article 8: Foreign-invested enterprises not engaged in transportation shall be exempt from license fees for the use of vehicles and vessels.

Article 9: Foreign enterprises that invest in energy or transportation projects (coal, power, rail, roads) can enjoy the following benefits:

(1)they may cooperate in the projects in a BOT (build, operate and transfer) mode.

(2)approved highway projects shall expand the land development and service management related to the projects within specified surrounding areas.