On September 2, 2015, the Ministry of Finance (“MoF”) and the SAT jointly released Circular Cai Shui  No. 99 (“Circular 99”) to further expand the scope of the preferential EIT policy for small and low-profit enterprises provided under Circular Cai Shui  No. 34 (please refer to our Legal Flash of March 2015).
Circular 99 provides that, from October 1, 2015, to December 31, 2017, all small and low-profit enterprises4 can reduce their annual taxable income by 50% and subject it to 20% EIT (the effective EIT rate is 10%).
Before Circular 99, the scope of this preferential EIT policy was limited to small and lowprofit enterprises with an annual taxable income below RMB 200,000.
Date of issue: September 2, 2015. Effective date: October 1, 2015.