China lowers corporate, personal income tax for Hainan free trade port

Chinese authorities have rolled out preferential income tax plans for companies and individuals in the southern island province of Hainan to build it into a globally-influential free trade port.

According to a circular jointly issued by the Ministry of Finance and the State Taxation Administration, corporate income tax rates will be lowered to 15 percent for Hainan-registered eligible companies in certain industries.

Companies in tourism, modern services and high-tech sectors in the island province will be exempt from paying income tax for their proceeds from new outbound direct investments, said the circular.

Individuals with high-level and in-demand expertise working in Hainan will pay income tax no higher than 15 percent of their gross income, business earnings and government-approved allowances from the free trade port, according to a separate circular issued by the two central departments.

Both documents are effective from Jan. 1, 2020 to Dec. 31, 2024.