1. The profits of companies in Yunnan province earned in their first two years will be exempt from income tax. From their third to seventh years, companies should pay local income tax but the money will be returned in full by the fiscal department at the same level. Starting from their eighth year, companies will be levied income tax at a rate of 15 percent.
2. The local share of VAT paid by companies in their first three years of operation will be returned in full by the fiscal department of the same level.
3. Shares awarded and allocated to employees by the enterprises that are put back into production or operation can be exempt from individual income tax.
4. Those in charge of high and new technology outcomes and the main implementers of these outcomes' industrialization have no limitation in the distribution of shares and are able to gain their return on equity.
Projects with government funding can gain returns on equity of no less than 60 percent in the first three years and no less than 40 percent in the next three years. No less than 20 percent of transfer income is guaranteed after result transferring.
The return on equity invested in high-tech industrialization projects will be deducted when levying individual income tax.
5. The minimum registered capital of companies engaging in high-tech projects or product development is 30,000 yuan ($4,365.33). The minimum registered capital of establishing a limited liability company in Yunnan is 100,000 yuan and the founder's living houses are allowed to be sites for business operation.
The discount for high-tech achievements can account for no more than 35 percent of the total registered capital. The percentage can be appropriately relaxed for non-State-owned high-tech enterprises.
6. Lands required by companies to be used for research, development, production and management can get priority in waiting for approval and the local share of land using fees can be halved.
7. Related governments will complete procedures such as companies' water supply, communications, and fire safety within specified time limits as long as companies hand in valid and complete materials.
The time limit for urban construction planning departments is 10 days, while the limit for land departments is five days. Departments relating to water supply, electricity supply, natural gas supply, communications and fire safety should finish their procedures within five days.
8. Yunnan Provincial Department of Finance has set up a one-off risk fund of 50 million yuan for high and new technology industries in Yunnan province.
9. The expenses used by companies in researching and developing new techniques, technologies, materials or products are not limited and can be included in administrative expenses.
The money used to buy key equipment and test instruments for trial manufacture can be amortized into administrative expenses for one or more times as long as the price of a single piece of equipment is no more than 100,000 yuan. Equipment or instruments reaching the standards of fixed assets should be managed separately without depreciation.
In order to raise its technological level, the company can raise 1 or 2 percentage points of the original equipment on the basis of comprehensive depreciation.
10. Those participating in the acquisition and merger of State-owned enterprises while conducting asset reorganization approved by provincial State-owned assets management departments in Yunnan can be can be granted delays when paying the acquisition fees.
*This English version is only for reference. To learn more, please refer to the authoritative Chinese version on yn.gov.cn.
