The State will continue to levy preferential taxes on foreign investors, as well as those from Hong Kong, Macao and Taiwan, following its accession to the World Trade Organization (WTO).
A senior official with the State Economic and Trade Commission (SETC) yesterday in Beijing said the tax preferential policy has contributed to and will continue to play a large role in China's vibrant economic performance.
"We will not change the policy, but we are striving for a more equal way for overseas and domestic enterprises," said Zhang Zhigang, vice-minister of the SETC.
Zhang said the State will adhere to the policy to encourage overseas enterprises to invest in industries believed to be economically, socially and environmentally beneficial to the nation. The State now implements two-tier taxing policies for overseas and domestic investors.
As a common practice of developing countries, different preferential taxes have been levied by China on investors in different industries and sectors, according to a foreign investment source.
"The practice is in accordance with WTO's national treatment rule," said the source.
Zhang made the remarks at a press conference organized by the Information Office of the State Council to brief the progress achieved by SETC on China's accession to the WTO.
Entrusted by the central government, SETC is busy drafting WTO-related economic and trade regulations, said Zhang Delin, director of the commission's Department of Economic Laws and Regulations.
"While abrogating those laws and regulations not in line with WTO rules, we are heavily involved in drafting new laws and regulations," Zhang said.
According to Zhang, his commission and the State Administration for Industry and Commerce have finished drafting an Anti-monopoly Law to protect fair competition. It will shortly be submitted to the National People's Congress for discussion and approval.
(China Daily December 14, 2001)
