(财政部、国家税务总局关于小型微利企业所得税优惠政策的通知)

On March 13, 2015, the Ministry of Finance (“MoF”) and SAT released Caishui [2015] No. 34 (“Circular 34”) to expand the scope of the preferential EIT policy for small and low-profit enterprises.

Circular 34 provides that, from January 1, 2015, to December 31, 2017, small and low-profit enterprises2 with an annual taxable income not exceeding RMB 200,000 can reduce their annual taxable income by 50% and subject it to 20% EIT (the effective EIT rate is 10%).

Before Circular 34, the scope of this preferential EIT policy was limited to small and low-profit enterprises with an annual taxable income not exceeding RMB 100,000.

Date of issue: March 13, 2015. Effective date: January 1, 2015.