MARKET WATCH

The Chinese Government adopted a package of mea-sures to rescue the tumbling mainland stock markets. It will let listed companies repurchase their shares in the open markets and require the government's investment arm to increase its holdings in major listed domestic banks. But most notably,the government ditched the stock trading stamp tax charged to those who buy shares. Mainland steel prices are expected to drop in the fourth quarter when industry leader Baosteel cuts its prices in October and November. Chinese companies such as Sinosteel and China Oilfield Services are increasing their acqui-sitions of,and stakes,in foreign companies.     

Aging City Leads Way

The northern city of Dalian has become a model of care for the elderly that other Chinese cities are following Chinese Minister of Civil Affairs Li Xueju has called upon civil affairs agencies in the nation to learn from Dalian's diversified models for elderly care,ranging from running collectively owned and foreign-designed nursing homes to offering tax incentives to private households and companies serving the elderly     

Nurturing SMEs

Practical financial,tax and accounting issues affecting international SMEs during the early stages of investment VAT and customs policies Chinese customs provides preferential treatment to foreign companies as a tool to encourage them to set up operations in certain industrial sectors.For example,some foreign enterprises are entitled to the preferential     

MEANS TO AN END

The Chinese Government will offer preferential income tax treatment to enterprises in the field of integrated circuit (IC) design and software, the Ministry of Finance said in a statement on May 22. According to the ministry, IC and software companies that made a profit before the end of 2018 will be exempt from paying income tax for two years, while the in come tax rate will be halved to 12.5 percent from 25 percent for the third to fifth years.     

Nasdaq Comes to China

As more Chinese companies begin looking for opportunitiesabroad, the world’s largest electronic stock market, Nasdaq—which has often partnered with small start-up companies—maybe within easier reach than ever before. Today, there are 29 Chinese mainland-based companieslisted on the Nasdaq, most of which are dotcoms. Granted,that’s still a small share of the 3,200 companies listed onNasdaq, but the market is certainly reaching out to China. Nasdaq is planning on opening an office in Beij…     

ECONOMY

<正>Tax Rebates Overseas visitors will soon be able to claim tax refunds on purchases made in Beijing in a move to boost tourism and consumption in the city.Concerned departments of the Beijing Municipal Government are discussing details of the tax refund scheme and it is expected to be implemented later this year,Vice Mayor Cheng Hong announced on April 27.According to the plan,foreign tourists and those from China’s Hong Kong,Macao and Taiwan who have stayed on the Chinese mainland for no more than six months may receive a rebate of 11percent on consumer goods purchased at designated retail outlets.The minimum purchase for a tax refund is 500 yuan($82)at any one store in one day.The Ministry of Finance announced in January that China would expand the tax refund program to spur inbound     

Housing Gap

Measures to cool down China's red-hot housing market are sweeping the country. The State Council, China's cabinet, issued a circular in late May announcing an increase in the minimum down payment for a new apartment larger than 90 square meters to 30 percent from 20 percent and imposing a transaction tax on properties resold within five years of purchase, among others. One of the aims, according to the cir-     

China Reshuffles Export Incentives

What it means for China's economy... Last month, the Chinese Government made sweeping changes to the export tax breaks that domestic companies receive. Here's what happened: On September 14, the Ministry of Finance, the General Administration of Customs, the National Development and Reform Commission, the Ministry of     

Business in Brief

China to Revise Tax Law to Help CharitiesThe recently promulgated Guidelines on the Development of China's Charities (2006- 2010) call for revision of the country's tax laws to aid the development of charity. Wang Zhenyao, director of the Ministry of Civil Affairs' Department of Disaster and Social Relief indicates that further tax reductions and exemptions for private and corporate charity do- nators are likely in the future. China is currently faced with three charity-related challeng…     

Focus

Multinationals on pollutant BlacklistMore than 100 multinationals, suchas Pepsi, Whirlpool and Bosch, are onthe Institute of Public and Environ-mental Affairs blacklist for infringingChinese anti-pollutant regulations. Mostof them are Japanese, US and Euro-pean companies that are engaged in themanufacture of foodstuffs, chemicals,electronics and machines. One third ofthem are located in Shanghai, the restin other cities. A large portion of the7,000 pollutant companies listed are do-mestic. Ma Jun, director of the institute,     

Rational Taxation

Individual income tax reform is expected to narrow the gap between the rich and the poor People earning less than 2,000 yuan ($274)a month will not have to pay income tax in 2008.This is good news for Chinese breadwinners who have increasingly felt the pin- ch of rising prices in the past year. On December,23 2007,the draft amend- ment to the Law on Individual Income Tax was submitted to the Standing Committee of the National People's Congress(NPC),     

Legal-Ease Beijing & Northeast China Investment Facts

Beijing and northeast China are fast becoming areas of growing interest to international investors. Here we highlight some aspects of cities in northeast China and consider the options for setting up business in the capital. Beijing investment zones identified China's development zones generally offer foreign investors better infrastructure, lower tax and other incentives, and much higher levels of service support than elsewhere in the country. The table here lists the main investment zones in Beijing itself.     

Kingdom of Bamboo Shoots

Science and technology are the primers of productivity. This widely cited slogan often attributed to Deng Xiaoping is the key to the survival of many private companies     

Retired Life

As Hong Kong inhabitants have a sense of privacy and their living space is often limited, they seldom invite people to their homes. The teahouse is the most popular meeting place. Our interview with Tsui Chee, however, was at his homeMEI Foo Sun Chuen, Hong Kong's first private residential subdistrict in Lai Chi Kok, was built in 1968. It epitomized a well off society where middle-class people, such as Tsui Chee and his family, moved in the 1970s, to live in compact communities. Tsui Chee's apartment has an area of more than 80 square meters. It is furnished in a manner similar to that of a mainland household, other than the altar left of the entrance, where devotions to deities and ancestors are made. As the principles of fengshui are commonly observed in Hong Kong, the position of the altar in the household is decided by geomancers. Hong Kong people visit temples to worship deities and also to draw bamboo slips out of a pot for divination purposes. Geomancers are employed to determine the most auspicious location of new companies and suitable layouts of houses being considered for purchase.     

China's NASDAQ Countdown

The mainland NASDAQ-like market is meant to fuel emerging companies,but the risks are high after nearly a decade of delibera- tion,the growth enterprise market (GEM) on the mainland will soon be opened,providing a boon to the country's start-up companies. Shang Fulin,Chairman of the China Securities Regulatory Committee (CSRC), vowed to push forward the debut of China's growth board to establish a multi-layer capi- tal market.     

New Technologies ：oster Strong Economy

ECONOMIC globalization has entered a new stage of devel- opment since the international financial crisis. The emphasishaving shifted from manufacturing to innovation, the latter attracts unprec- edented volumes of capital and other resources. To keep up with this trend, China＇s sci-tech companies are stepping up independent innovation rather than replicating or borrowing other coun- tries＇ technologies.     

MARKET WATCH

The Chinese stock market is maturing more than ever before amid stricter supervision from supervisory agencies. China's banking regulator will punish eight Chinese banks for negligence in overseeing several companies charged with the illicit use of bank loans. Asia's largest container line COSCO Holdings Co. reported the fourth largest initial public offering this year on the mainland Ashare market, followed by the announcement that PetroChina will return to the mainland stock market this year. China and the United States will probably witness a widening trade gap as the U.S. side issued a policy forbid-ding the export of certain hi-tech products to China, ignoring China's effort to curb the trade surplus by slashing tax rebates. China is expected to sell special bonds to buy for-eign reserves to fund its new foreign reserve investment company, due to open later this year.     

Criticism of China＇s Anti-Trust Actions Is Unfounded

正THE Chinese government has recently launched antimonopoly probes against foreign corporate giants such as Microsoft,Mercedes-Benz and Audi.Some Western media outlets have interpreted the investigations as suppression of foreign enterprises.Although expected,these reactions are unreasonable in the light of evidence.China’s restrictions on monopolies are no more extreme than those practiced by other major economies,and in some ways are more lenient.When foreign companies violate laws,the Chinese government is obliged to step in     

Animating Chinese Animation

JAPANESE and Western companies have long dominated China's vast animation market, but the tide is about to turn. That is the hope, at least, of Chinese animators after the State Administration of Radio, Film and Television (SARFT) announced its latest move. On April 26 this year, SARFT proclaimed that domestically created cartoon producers would enjoy sales tax breaks and a range of other preferential policies. This is not SARFT's first attempt to galvanize the long suffering domestic     

Smart Green City

Ever since the unveiling of the blueprint two years ago,Xiongan New Area,featuring hi-tech,smart urban planning and a sound ecological environment,has been in the media spotlight In the ensuing years,changes have started to take shape.Express railways linking Xiongan and Beijing are under construction,with more than 1,300 companies setting up branches in the area.Now,large-scale construction is about to begin.