In order to expand the scale and to increase the efficiency of utilizing foreign and private capitals and to accelerate local economic development , the following preferences are formulated .

•  Preferences for Land Use

•  For newly requisitioned land that is used to establish industrial projects with foreign or private capital , all types of land fees including land compensation fees are exempt at the local level (city ,town, and village )but not exempt at the Jiangmen City level or higher. The composite price for requisitioned land that is “five-ready-and-leveling “(refers to easily accessible water and power supply , telecommunications ,sewage system, and roads and land leveling has been completed)shall not be less than 75 yuan/m 2 (less than 50,000 yuan/acre ) in Taicheng town and Dajiang town ,and less than 45 yuan/m 2 (less than 30,000 yuan/acre ) in other towns .

•  And that is used to establish industrial projects with foreign or domestic capital can be rented out for as long as 50 years. For “five-ready-and-leveling “land , the rent shall not exceed 1.5 yuan /m 2 in Taicheng town and 1 yuan m 2 in other towns.

•  Workshops rented by foreign or domestic capital enterprises can be built according to the investor's requirements as the rents are negotiable.

•  Industrial workshops that are built with foreign or domestic capital are exempt from the Land Remise Fee if the workshops are to be rented out .

•  Land used for scenic spot or hotel project with an operating period of more than 10 years and an investment value of over 10 million US dollars can be treated in accordance with the preferential standards of industrial land use.

•  Land used by foreign or domestic capital flagship enterprises to process agricultural products are treated as farmland as its land use fees can be reduced, postponed, or exempted .

•  For new workshops and attached facilities (whether for self-use or rent )built by foreign or domestic capital enterprises, the Project Application Fee and other administrative social fee items shall be reduced and combined to one standard fee . Within 39 km 2 of the downtown area, the fee is uniformly 22.5 yuan/ m 2 for concrete structure and 17 yuan/ m 2 for steel structures .In other areas ,the fee is uniformly 12.7 yuan m 2 .

•  For workshops and attached facilities built by foreign or domestic capital new industrial enterprises ,the land development township government or agency shall be responsible for the Water Soil Preservatipn Fee .

•  For workshops and attached facilities built by foreign or domestic capital new industrial enterprises, the Property Ownership Transaction Fee shall not exceed 2 yuan/m 2 .

•  For foreign or domestic capital new industrial enterprises , the water supply network compensation fee and account application fee shall be discounted 70% from the current standard .

•  For foreign or domestic capital new industrial enterprises, the Labor Contract Fee and deployment fees of outside city workers shall be cut in half during the first 3 years of investment production.

•  For foreign or domestic capital new industrial enterprises, service fees for writing audits , notaries , inspection certificates , accounting ,and asset appraisals of lands, warehouses , and any facilities shall be reduced by half of the lowest national standard fee .

(1) Income Tax

•  Foreign capital production enterprises with an operating period of more than 10 years may qualify for total income tax exmption during the first two years of profitability and 50% income tax reduction the next three years afterwards. This is based upon the approval of the tax bureau .

•  Chinese-foreign joint enterprises with an operating period of more than 15 years undertaking port or dock construction projects are exempt for income tax during the first 5 years of profitability ,and receive 50% income tax reduction the next five years afterwards .

•  Foreign capital export enterprises with annual exports accounting for more than 70% of its total production volume may qualify for a standard income tax rate reduction of 50% after the initial tax exemption or tax reduction period .This is based upon the approval of the tax bureau .

•  Foreign capital hi-tech enterprises are entitled to receive a standard income tax rate reduction of 50% three years after the initial tax exemption or tax reduction period .

•  Foreign capital enterprises located in the outlying districts or involved in the business of agriculture ,forestry ,or animal husbandry may qualify for a 15% to 30% income tax reduction after the initial tax exemption or tax reduction period .This is based upon the approval of the tax bureau .

•  Foreign capital enterprises reporting a loss of a particular year can offset its loss with earnings of the following year of after up to 5 years .

•  Foreign investors of a foreign capital enterprise reinvesting profits into the same enterprise or into another enterprise with an operating period of more than five years may receive a tax credit based upon the approval of the tax bureau .For an export oriented or hi-tech enterprise ,this credit is the full income tax paid on the reinvested amount .For other enterprises ,the credit is 40% of the income tax paid on the reinvested amount.

•  Hi-tech foreign capital enterprises as certified by the Provincial Technology Bureau and Tax Section specializing in new technologies has a standard reduced income tax rate of 15% .If the hi-tech enterprise is also a production enterprise with an operating period of more than 10 years ,it is exempt from income tax during the first two years of profitability .On the third ,fourth ,and fifth year of profitability ,its reduced income tax rate is 7.5%.

(2) Value-Added Tax ,Consumption Tax

•  If the foreign-capital enterprise exports its own products and belongs to the Ordinary Value-Added Taxpayer category ,its value added tax goes according to the policy of “exemption ,compensation ,and refund .”Foreign-capital enterprises exporting its own products and belonging to the Small Value-Added Taxpayer category are exempt from value-added tax .

•  Foreign capital enterprises exporting its own products are exempt from consumption tax .

•  Imported goods by foreign-funded enterprise through “processing raw materials on client's demands “or “processing with imported materials “will be exempted from Value-added Tax and Consumption Tax in import phase .Exported process products will be exempted from Value-added Tax and Consumption Tax for processing or entrusted processing and Industrial Collection Fee .Finished goods produced by foreign-funded enterprise with imported materials, if transferred to another foreign-funded enterprise which carries on “processing with imported materials “to re-process and reassemble for export ,will be exempted from Value-added Tax and Consumption Tax in production phase .

•  Value-added Tax having been collected in production phase for export goods produced by compensation trade project will be refunded in accordance with relevant provisions after applying to customs for export .

•  Self-run agricultural goods sold by enterprise with foreign investment specializing in breeding ,planting ,forestry ,animal husbandry will be exempted from Value-added Tax .

(3) Property Tax

Foreign-country enterprise or foreign-funded enterprise is exempted from City Property Tax within 3 years ,while Overseas-Chinese-funded enterprise 5 years .

•  Large-scale project with 10 million US dollars foreign or private capital or above ,can be reported to the City Government for special treatment .Special preferences will be applied to it in aspects such as land-use ,electricity supply ,water supply ,and fees for administrative and public affairs .

•  Large-scale project with private capital established in the south of Taishan, will receive 100 mu “5-ready-and-leveling”land (fees for relevant certificates not included).

•  Newly-established foreign-funded or private enterprise with annual ratal of 10 million yuan or above ,and newly-established new-high –tech enterprise certified by provincial or higher authorities , will be given 500,000 yuan technology development special subsidy annually by City Government from technology development special fund for 3 consecutive years .

•  After put into operation ,Administrative and Public Affairs Fees for foreign-funded or private enterprise established in Industrial Places approved by City Government will only pay for the portion collected by Jiangmen City or higher level authorities ,while the portion collected by Taishan City is exempted .

•  In principle ,”independent-style “management will be implemented for foreign-funded enterprise or private enterprise established in Industrial Places approved by City Government ,which means that Industrial place Management Committee will be the sole entity to administrate the said enterprise .Without the permission of the Committee ,any other department or individual is not allowed to have inspection or charge against enterprises within the Places .

•  Taishan Bureau of Investment provides foreign-funded or private enterprise with policy consulting and free comprehensive services such project-valuation and approval ,commerce ,tax ,fire-control and business registration ,opening of bank account ,environmental protection examination approval and customs registration .

•  Complaint Center for foreign-funded and private enterprise and hot line are set up to deal with relevant complaints .

•  Taishan City Toll Collecting Center for foreign-funded and private enterprise and Taishan City Construction Applying and Report Center will hand-in –hand handle affairs concerning the said enterprise .”Government affairs publicizing “and “promise system “are implemented to provide foreign-funded and private enterprise with “one station” and “one window toll “ services handling fees for relevant certificate applying and construction applying and report .Of which ,Construction Applying and Report Fee is a “once-for-all “standard fee by combing various fees and is put into City Finance Special Account .

•  Except Business Certificate ,Quality Examination Certificate or production operation project needing special examination ,which are required by National Commissions or by Provincial Government ,any other sections are not allowed to set up pre-stablishment examination procedures for establishment of the said enterprise .Integrated examination and approval will be carried out for enterprise whose operation category of Enterprise Establishment Registry applying includes pre-establishment examination and approval procedures undertaken by relevant departments of Taishan City ,and the said examination and approval should be finished within time limit .

•  Industry monopoly is strictly prohibited for foreign-funded and private enterprise .For projects which require examination-and-approval and check-up and acceptance ,such as fire-control ,environmental protection ,public hygiene, electricity supply ,water supply ,anti-thunder ,the said enterprises are entitled to decide on the choice of qualified organs and installation departments and to purchase qualified materials .

•  Land-use for newly-established project and relevant fees for current foreign-funded and private enterprises which increase investment or expand production and operation will be carried out in accordance with item 1 and 2.

•  Current foreign-funded and private enterprises that increase investment or expand production ,if their newly-increase tax ratal reaches 10 million yuan on the basis of the tax ratal in 2001,will be given 500,000 yuan technology development special subsidy by City Government from Technology Development Special Fund for 3 consecutive years .

•  Preferences will be given in accordance with policies herein to foreign-funded and private enterprise which purchase , annex ,share-hold state-owned or collective enterprise ,or accounts for 30% or above the shares of state-owned or collective enterprise .Of which ,the price for wholly-remised state –owned or collective enterprise will be determined reasonably after non-operation asset and inefficacious are axed . Simultaneity , preferences will also be given for allocation of the working staff .Fees for asset valuation ,asset ownership transaction and change or property are reduced by 50% in accordance with the lower limit of current toll standard. Extremely-difficult enterprise will be treated with special measures.

•  Preferences will be given in accordance with item 7 herein to foreign-funded or private enterprise which rents ,contracts with state-owned or collective enterprise and reinvests to rebuild or expand the said enterprises.

•  If needed by foreign-funded and private enterprises ,expertise or production management backbones, as well as their families ,will be exempted from Residence Grain Risk Fund when they move in Taishan City .

•  Personnel Section prefers to handle the procedures for foreign-funded and private enterprise to introducing intellectuals. High-level intellectuals who have advanced title of Technical Position or degree of Master or Doctor and introduced by foreign-funded and private enterprises, will enjoy preferences fulfilled by Personnel Section in purchasing houses. Labor Department and Social Security Department will provide the families of the said intellectuals with employment introduction ,while Education Department facilitates their children's going to school .Medium or high-level management personnel and people who have diploma of technical secondary school and elementary or higher title of Technical Position will be provide with services such as Personal File management ,Technical Position assessment ,examination-and-approval for going abroad .

•  This “Preferences “is put into effect on this day of 1 st ,July 2002 and it shall prevail .

•  The “Preference” is under the explanation by Office of Government of Taishan City .