Guangdong saves companies billions in taxes

Guangdong’s tax reduction campaign is kicking up into a higher gear. Companies have seen more than RMB67.27 billion stay on their balance sheets over the past four months, an effective saving of around 27% of their overall tax bills. And that’s not all: further cuts are kicking in since the new tax year began on April 1.

The biggest changes are coming in reforms of value-added tax (VAT), which started on April 1. This alone has seen savings of RMB13-billion in the first month, which suggests 2019 will vastly exceed 2018’s tax cuts. The province’s manufacturing industry has been the biggest winner, seeing RMB6.14 billion of these gains, with electronics and automobiles benefiting the most.

The policy added confidence to the market against the pressure of economic downturn, said Li Hanfeng, secretary-general of the Guangdong Federation of Industry and Commerce. Despite the cuts, tax revenues overall are still rising in Guangdong, as populations increase: tax registration households were up 11.5% YoY in the first five months. Moreover, profits are up, too: Industrial output rose 8.6% YoY in the first four months. 

Read more (in Chinese).