Company News

South China’s economic hub, Guangzhou, recently issued a new official document emphasizing that the government will give more incentives to foreign direct investment (FDI) attraction. The document pushes Guangzhou to have more sectors open to FDI, offer more fiscal support as well as regulatory convenience, and build up better infrastructure.

On March 3, 2011, Guangdong Province issued the Tentative Provisions of Guangdong Province on Foreigner Administration and Services (Government of Guangdong Province No.155), effective May 1, 2011, to regulate the administration of and optimize services for foreigners in Guangdong.

Based on Beijing’s average annual wage level RMB50,415 in 2010, the Beijing Municipal Bureau of Human Resources and Social Security announced the wage bases for distinct employees’ social security payment in 2011.

On April 12, 2011, the State Administration of Taxation (“SAT”) issued the Circular on Relevant Issues Regarding the Administrative Regulations on the Trial Implementation of the “Comparison Prior to Deduction” Policy Applicable to the Special Letter of the Customs Import Value-Added Tax (“VAT”) Payment (“Customs’ Tax Payment Letter”) in Certain Areas (Guoshuihan [2011] No. 196, “Circular”).

Even though they are usually better off than local Vietnamese companies, it seems that many foreign invested enterprises (FIEs) established in the country encounter hardships to follow the general evolution in terms of human resource (HR) management.

On March 21, 2011, the Vietnamese Ministry of Industry and Trade (MoIT) issued a circular regulating the issuance of the certificate of origin (C/O) for goods being exported.

On March 28, 2011, the China State Administration of Taxation (SAT) issued the Announcement Regarding Several Issues on the Administration of Non-resident Enterprise Income Tax (EIT) (Announcement 24), which clarifies certain terms in the Circular on Strengthening the Administration of EIT on Gain Derived from Equity Transfer Made by Non-Resident Enterprises (Guo Shui Han [2009] No. 698) (Circular 698) issued by the SAT in December 2009.

Following the issuance of “Corporate Income Tax (CIT) Law” in 2008, China’s State Administration of Taxation (SAT) has also released a number of regulations specifying distinct tax treatment to enterprises under specific conditions. Based on these documents, the SAT has recently made an announcement (SAT Announcement [2011] No. 29) that tells eligible enterprises what to note during their annual CIT declaration, in order to make sure each particular tax treatment can be well received.

Jim Zimmerman, the China managing partner of U.S. blue chip law firm Squire Sanders Dempsey is a good friend of China Briefing and is also both the Chairman Emeritus of Amcham China and the author of the China Law Deskbook – considered by many to the bible of China law. Jim has recently introduced a monthly update service to the China Law Deskbook and has kindly given permission for China Briefing to host this each month.

Withholding tax is a government requirement for the payer of an item of income to withhold or deduct tax from the payment, and pay that tax to the government.