China MOF Issues Guidelines on Preferential Tax Policies for Small Businesses

The Chinese Ministry of Finance Dec. 21 issued guidelines on preferential tax policies supporting individual businesses, and micro, small, and medium-sized enterprises (MSMEs). The guidelines include: 1) tax deduction policies for venture capital companies, angel investors, and R&D expenses, and a modified depreciation deduction calculation; 2) a VAT exemption for taxpayers with monthly sales under 100,000 yuan (US$14,020), from Jan. 1, 2023, to Dec. 31, 2027; 3) a VAT exemption on interest income paid to financial institutions on microloans of up to 10 million yuan (US$1.4 million) made to small and micro enterprises and individual industrial and commercial households, until ...