China increases tax breaks for small businesses

The State Council, China's cabinet, on Wednesday decided to extend tax breaks to more small businesses for their roles in generating jobs and growth.

From Oct. 1, 2015 to the end of 2017, companies with annual taxable income under 300,000 yuan (46,900 U.S. dollars) will have their corporate tax halved, said a statement released after a meeting chaired by Premier Li Keqiang. Previously, the threshold was 200,000 yuan.

The meeting also extended tax breaks for companies with a monthly revenue of 20,000 to 30,000 yuan from the end of 2015 to the end of 2017. They will be exempted from value-added tax and business tax.

The move is the latest attempt to help small businesses, as they provide nearly 80 percent of urban jobs.

In the first six months, about 2.39 million small and micro enterprises in China paid reduced taxes, savings them about 8.6 billion yuan, according to figures from the State Administration of Taxation.