Local Policies

Beijing

On May 8th, 2009, the General Office of Beijing Municipal People’s Government forwarded the Notice of Beijing Municipal Commerce Commission on Facilitating the Advancement of the Outsourcing Industry ([2009] No.27).
• From the year 2009 to 2013, a 15 percent deduction on corporate income tax will be offered to advanced-technology service enterprises. Employees’ education and training expenses are deducted before the calculation of corporate income tax with a ratio of no more than 8 percent of the total income. Sales taxes are exempt for accredited advanced- technology outsourcing enterprises.
• The total amount of funds allocated to the outsourcing industry by the Municipal Government should not be less than twice of those from the Central Government. The main usage of the funds is to expand the industry size, to help model districts build public service platforms.
• To encourage outsourcing enterprises to be listed nationally and overseas, to help eligible non-listed enterprises enter Zhongguancun Stock Transfer System to finance and transfer stocks.

Tianjin

On April, 7th, 2009, Tianjin Municipal People’s Government published the Notice ([2009] No.41) on Carrying Out the [2009] No.9 document issued by the General Office of the State Council to facilitate the advancement of the outsourcing industry in the city.
• To make action plans to give initial investment funds full play and to support the development of outsourcing enterprises.
• The Government to encourage official authorities and enterprises to outsource non-private businesses, such as data process, in the form of service purchasing.
• The financial sector should support the outsourcing industry from such areas as loans, insurance, security, and foreign currency exchange.

Shanghai

On May 26th, 2009, the General Office of Shanghai Municipal People’s Government printed the Notice on Suggestions about Advancing the Development of the Outsourcing Industry ([2009] No.16).
• To actively develop an base for outsourcing internships. Intern participating students are eligible for an allowance, which is 60 percent of the official minimum wage in Shanghai issued by the unemployment insurance fund.
• To provide assistance and facilitation in permanent residency registration and application for employees, who meet the outsourcing talents introduction criteria.
• To offer tailored insurances for the outsourcing industry, encouraging enterprises to purchase export credit insurance.
• To establish a “green channel for foreign currency exchange businesses”, providing convenient services for eligible outsourcing enterprises in handling relevant foreign currency exchange businesses, simplifying procedures, allowing the enterprises to make payment for and share costs with their overseas associating companies after their nature of being an international enterprise is validated.
• To lower the standards for outsourcing enterprise registration, allowing enterprises to use words such as “service outsourcing” and “outsourcing service” in company names. In terms of verifying an company’s description of businesses, allow it to clarify its “forms of outsourcing”.

Zhejiang

On April 1st, 2009, Zhejiang Provincial Government promulgated the Notice on Encouraging and Supporting the Fast Advancement of the Offshore Outsourcing Industry ([2009] No.20).
• A 15 percent deduction on corporate income tax for advanced- technology service enterprises. To offer incentives for the enterprises, which have the highest executed contract values.
• To encourage offshore outsourcing enterprises to apply for patents, develop their own brands, assist international outsourcers in setting up research centers in China. Encourage enterprises to boost research input in order to be eligible for preferential income tax for the development of new technologies, new products and new technics.
• To provide assistance for international outsourcers undertaking international businesses, and research centers, purchasing centers, and regional headquarters of local enterprises.

Guangzhou

On April 13th, 2009, Guangzhou Municipal Government issued the Measures on Allocating and Managing Special Funds for Promoting the Outsourcing Industry ([2009] No.2).
• Programs that are supported by preferential national or provincial policies will receive a one-off fund pro rata.
• To cover up to 60 per cent of the training expenses for outsourcing personnel trainings.
• To cover up to 50 per cent of the expenses in researching patent technologies, purchasing facilities (taxes inclusive), and conducting offshore outsourcing.
• To offer up to RMB1 million to outsourcing enterprises for innovative R & D projects.
• To provide up to 100 percent of expenses in international certifications accreditation.
• To offer a reward up to RMB500 thousand to enterprises or exemplary zones, which have made a great contribution to the industry development.
• To provide a subsidy up to RMB1 million for public technologies, trainings, and construction and operation of service platforms.
• To cover 50 or 100 percent of the total cost of key outsourcing promotions.

Shenzhen

Temporary Measures on Allocating and Managing Dedicated Funds for the Development of the Outsourcing Platform ([2009] No.21)
• To subsidize a 50 percent of the cost of equipment purchasing for public technology platform, with the total amount not exceeding RMB500 thousand. The one-time payment is available after the construction finishes. There is a subsidy for operation maintenance, which can reach up to RMB150 thousand per annum.
• To subsidize a 50 percent of the cost of equipment purchasing for public information platform, with the total amount not exceeding RMB500 thousand. The one-time payment is available after the construction finishes. There is a subsidy for operation maintenance, which can reach up to RMB100 thousand per annum.
• To subsidize a 50 percent of the cost of equipment purchasing for public service outsourcing training platform, with the total amount not exceeding RMB500 thousand. The one-time payment is available after the construction finishes. There is a subsidy for operation maintenance, which can reach up to RMB300 thousand per annum.

Daqing

On July 29th, 2009, Daqing Municipal Government issued the Notice on Preferential Policies for Supporting the Development of the Outsourcing Industry.
• To encourage the top 100 international outsourcers and the top 50 local outsourcers to set up outsourcing enterprise headquarters, regional headquarters, and branches in Daqing, for operation tax purposes. All the operation incomes generated from offshore outsourcing businesses will be rewarded. An income of USD5-10 million, USD10-20 million, USD20-50 million, and above USD50 million will be awarded a bonus of RMB100, 200, 300, and 500 thousand respectively.
• To subsidize rent on data lines for accredited outsourcing enterprises. When renting dedicated national or international lines, the government will offer an annual subsidy of 30 or 50 percent of the total rent respectively, with the total amount not exceeding RMB300 thousand.
• To encourage universities to integrate academic resources, forming an outsourcing research group. A subsidy of RMB300 thousand will be offered to any university that is creating outsourcing disciplines and fostering talents.
• A special personal income returns rate is applicable for introduced senior management personnel, who has an annual income over RMB12 thousand.
• A skilled personnel with a diploma qualification and above, who has been working in the outsourcing industry for more than a year, is eligible to apply for registered residence in Daqing. The requirement of academic qualification for core staff can be lowered to vocational school diploma. Those who have an academic qualification lower than vocational school diploma need to be employed for at least three years to apply for registered residence in Daqing.

Zhuhai

On July 10th, 2009, Zhuhai Municipal Government issued the Details for the Implementation of the Several Measures on Promoting the Development of the Outsourcing Industry ([2009] No.1).
• A standard subsidy of RMB15 per square meter applies to enterprises renting offices in specific area. The subsidy for renting areas below 1000 square meters is RMB15 per square meter per month, while the subsidy for that of over 1000 square meters is RMB8 per square meter per month. The total subsiding area should not exceed 5,000 square meters.
• A 30 percent subsidy of the total cost is payable for international data line renting, with the total amount not exceeding RMB200 thousand for each enterprise per annum.
• Enterprises with an export volume of over USD500 thousand last financial year will be awarded a RMB10 thousand bonus for every USD50 thousand export increase in the current year.
• "Double-soft" certified outsourcing enterprises are allowed to use fixed assets and intangible assets to conduct cost accounting when meeting certain criteria. On acquiring approval from taxation authority, the duration of depreciation and amortization can be cut to as short as two years.
• The costs of research and development of new products, new technologies and new technics will be deducted by the rate of 50 percent of the research and development costs if they have been calculated into intangible assets, while the costs will be amortized by the rate of 150 percent of the intangible assets costs if they have been calculated so.
• During one financial year, corporate income tax will be exempted if the income of technology transfer is below RMB5 million, while the income tax on the part that exceeds RMB5 million will be halved.