BIZCHINA / Policies
Notions Concerning Accelerating the Growth of the Non-stated-owned
Economy
(yn.gov.cn)
Updated: 2006-05-17 11:15
Notions are proposed as follows in order to fully implement the
guidelines made in the 16th National Congress of the Communist Party of
China and the 7th Congress of the CPC's Committee of Yunnan Province, to
grasp opportunities and concentrate all efforts on resolving key problems
in the growth of the non-state-owned economy in Yunnan Province,
promoting the non-state-owned economy to a new level, and pushing forward
the construction of the "all-round well-off society" in Yunnan.
1. The non-state-owned economy should be unswervingly promoted.
(1) Enhancing understanding and awareness
Various types of the non-state-owned economy such as self-employed
business and individuals-owned business are important components of the
socialist market economy and active elements of economy that are
compatible with the level of productivity at the current stage. To
accelerate the growth of the non-state-owned economy is the requirement
to improve the basic socialist economic institution and to quickly
increase productivity. And it is of profound significance in readjusting
the structure of ownership, encouraging growth in new areas of economy,
further opening up to the outside and increasing employment. Without
great development of the non-state-owned economy, there will be no great
development of the whole economy of Yunnan and if without the fast growth
of a big number of non-state-owned enterprises (hereinafter referred to
as NSOEs), there will be lack of vigor and vitality in Yunnan's economy.
To develop the non-state-owned economy is to treat development as the top
priority and to give a full play to all creative activities. Under the
guidance of the "Three Represents", our understanding and awareness as
well as our sense of responsibility should be further enhanced so as to
be of one mind in taking effective measures for the development of the
non-state-owned economy as an important strategy for the overall
construction of the "well-off society".
(2) Sparing no efforts in creating good conditions for the growth of the
non-state-owned economy.
To accelerate the growth of the non-state-owned economy, people's
thinking must be further emancipated and it should be advocated to keep
up with the changes of time. To the same end, the level of people's
understanding should be raised, more flexible policies adopted, the scope
of business accessible to the non-state-owned economy expanded, the
capping on its scale of business lifted, mechanisms involving its
operation rejuvenated, and political trust on this economic sector
boosted. The national treatment principle should be carried into effect.
All thoughts, mechanisms, policies, laws and regulations that are
obstacles to the growth of the non-state-owned economy or all practices
that are incompatible with development should be abandoned. Endeavors
must be made to build an excellent environment for NSOEs and their
employees, whereas they can enjoy legal protection, social position,
political reputation and economic rewards as well as fair competition and
common progress with state-owned or collective enterprises. These steps
would serve to ensure a breakthrough in the development of the
non-state-owned economy.
2. Market access and areas for investment should be broadened.
(3) Enforcing examination and approval by law
Unless required by national laws and administrative decrees and
regulations, no departments or local authorities are allowed to set
previews in advance to examination or approval procedures for
establishing NSOEs. Department regulations and industry or trade rules
should not be admitted as preconditions for the previews. In cases where
previews are necessary, the scope of trades or products must be
re-publicized. Procedures for examination must be made known to the
public and be as much simplified as possible. Service mode such as the
"One-Window Model" or "One-Stop-Shop" should be adopted so as to enhance
efficiency.
(4) Reducing the cost for establishing businesses
The limitation on registration capital for NSOEs should be lowered. In
the event that NSOEs are not able to pay the registration capital fully
at one time, they shall be allowed to pay in installments and the first
installment may be as little as 10% of the full registration capital.
Intangible assets, such as labor capital (management ability or technical
specialty) and intellectual achievements (invention, patent, or technical
accomplishment) may be contributed as investment upon appraisal by
qualified licensed agencies. Efforts shall be made to review all
fee-chargeable items. No extra fees shall be charged at registration
except for the net cost of registration and other legitimate fees. The
registration of a group enterprise composed of NSOEs should be approved
providing the registration capital of the parent company reaches 5
million Yuan and it has at least three subsidiary companies, with the
total registration capital of both the parent and subsidiary companies
reaching 10 million Yuan.
(5) Standardizing access of trades
NSOEs are allowed to engage in all trade areas and products that are in
accordance with the state laws and administrative decrees and regulations
and are not in violation of the industry policy. NSOEs are encouraged to
invest in areas such as education, medicine, health care and sports or to
take part in the comprehensive exploration of rural development,
agri-business and infrastructure including energy, transportation and
water conservation etc. or the investment in and operation of urban
facilities. All trade and investment areas that are open to the outside
world are open to NSOEs as well. It is no longer necessary for NSOEs to
obtain approvals if they invest in ordinary infrastructure with their own
funds and commercial bank loans, for those projects whose total
investment exceeds the limitation for funds, records shall be filed with
the competent authorities.
(6) Lowering qualification conditions for obtaining import and export
right
Relevant authorities shall timely process import and export right for
NSOEs complying with national standard, and enable them to enjoy the
state credit & loan and tax refund policy for export business. For NSOEs
applying for foreign trade right, as long as they are in a commodities
production industry and has 500,000 Yuan as registration capital, the
application shall be approved. And they may enjoy the same treatment as
state-owned enterprises in such aspects as foreign trade and economic
cooperation, tax refund, quota allocation, grant of the Fund for
Promoting Foreign Trade, overseas investigation and business tours,
financing with tax return account as guarantee, and so forth.
3. Preferential policies on taxes and charges should be adopted to
encourage the development of non-state-owned economy.
(7) Implementing preferential policies on taxes
The threshold of value-added tax on self-employed business and other
individuals shall be elevated: for sales of goods, the original monthly
sales of 2,000 Yuan is hence raised to 5,000 Yuan; for labor service, the
original monthly sales of 800 Yuan as the taxable amount is hence raised
to 3,000 Yuan; for tax payment upon times, the original one time 80 Yuan
as the taxable amount is hence raised to 200 Yuan. Business income tax on
newly-established enterprises, key and leading agri-business enterprises
and NSOEs formed through mergers or purchase of state-owned or collective
businesses shall be exempted in the first 3 years after the business is
established. And between the year of the end of tax exemption and the
year 2010, the rate of business income tax shall be reduced to 15%. For
enterprises whose capital comes from other provinces, if 51% of their
registration capital originates from other provinces, or if the
investment amount from other provinces exceeds 5 million Yuan, they may
enjoy the preferential policies as granted by Yunnan Province for foreign
investors. For organizations that provide guarantee services to NSOEs
whose service charge is 50% lower than the current corresponding interest
rate of bank loans and whose incomes from guarantee service exceed 50% of
its gross income, their business income tax shall be exempted in the
first 3 years since its operation and between the year of the end of tax
exemption and the year 2010, the rate of business income tax shall be
reduced to 15%. All expenditures on research and development of new
products, new technologies and techniques shall be deducted before the
imposition of income tax. Donations by NSOEs given to non-profit
organizations or government institutions for usage in education, civil
affairs, poverty alleviation, charity, disaster relief, the "Hope
Project" and "Bright Project" shall be deducted before the imposition of
income tax.
(8) Implementing preferential policies on charges and fees
NSOEs may enjoy the same preferential policies on charges and fees as
granted for state-owned or collective businesses. For those merging with
or purchasing state-owned or collective businesses, they may enjoy the
provincial preferential policies on charges that are introduced to deepen
the reform of state-owned businesses. In the event that NSOEs need to
obtain land-use right by means of compensation as assignment, except for
commercial purposes, the compensation may be charged at 20% of the
appraised value of the land. If the compensation can be paid within 60
days, the enterprise may have a discount of 30%. If the compensation is
paid in installments, the enterprise may pay 25% within 60 days and pay
the rest within 5 years.
For NSOEs who pay compensation to exploit un-utilized land owned by the
state or the collective to develop forestry, plantation, aquaculture and
their auxiliary facilities, the compensation for land-use right as
assignment, contracting fee, or leasing fee in the first 5 years from the
date when the contract is signed shall be returned to the enterprises.
All administrative charges shall be exempted in new markets funded by any
NSOE in the first year from the date of its operation. For operators
starting business in newly established markets, all administrative
charges shall be exempted in the first 2 years.
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