Individual partners in Chinese venture capital enterprises will now pay less income tax throughout the next five years thanks to new preferential tax policies.
The decision was made Wednesday at the State Council's executive meeting chaired by Premier Li Keqiang, with a goal to inspire venture capital investment, enhance entrepreneurial and innovative efficiency, boost investment and facilitate the commercial use of science and technological achievements and prompt industrial upgrading.
Starting from January 1, 2019, individual partners of venture capital enterprises can choose to pay income tax either at the rate of 20 percent of their income from equity transfers and dividends or at the progressive rates of five to 35 percent levied on their income in excess of a specific amount.
The purpose of the tentative policy is to ease the tax burden of individual partners in venture capital enterprises, said the meeting.
