The taxes imposed on foreign-invested businesses, foreign-owned businesses and foreign individuals are income tax, value-added tax, consumption tax, business tax, land value-added tax, resource tax, stamp duty, animal slaughtering tax, urban real estate tax, vehicle license tax and individual income tax. The taxes shall be reimbursed to the foreign-invested businesses that purchase Chinese equipment.
    As of September 1, 1999, foreign-funded enterprises shall, upon the approval of the competent tax reimbursement authorities, collect back 40% of the investment they purchase Chinese equipment out of the incorporate income tax newly increased in the year the equipment are purchased over the year before, provided that the total amount paid thereon is in conformity with the ?Guiding Catalog for Foreign-funded Industries? (Type of ?To be Encouraged? and of ?To be Limited?) in the ?Circular of the State Council on Policies of Adjustment of Taxation of Imported Equipment? (GF [1997] No.37) and that the invested projects thereby are in accordance with and the ?Catalog of Key Industries, Products, and Technologies the State Currently Encourages to Develop?, and it is the same for the equipment purchased with the extra money apart from the total investment. The said Chinese equipment the enterprises purchase does not include those the investors contribute as registered capital.
Tax Reimbursement (Exemption from Taxes) for Export Goods
    1)Unless otherwise provided, foreign-funded enterprises follow the taxation management methods of ?Exemption, Offset, Reimbursement? as from January 1, 2002 and as for the links of sales of export products, the taxes paid shall first cover the dues for the home-sold products and then the extra amount shall be reimbursed, if any.
    2)Foreign-funded enterprises may be exempted from value-added and consumption taxes for their goods imported as materials to be processed on clients? demand, and may be exempted from the value-added tax incurred from processing of the aforesaid materials after the products are exported. The foreign-funded enterprises which have imported materials to be processed on client?s demand and then entrust the same materials to other enterprises may produce to the tax reimbursement authorities concerned the ?Tax Exemption Certificate for the Imported Materials to be Processed on Clients? Demand?, and get reimbursed for the consumption tax and the value-added tax on processing of the export products they recollect for export.
Individual Income Tax
    Foreign individuals working with the foreign-funded enterprises and the foreign-owned enterprises, institutions, public organizations, and government offices in China may carry out their commitments of tax return on a higher imposition base of individual income tax, i.e. starting point shall be CNY 3200 plus 800, the latter of which is the imposition base for domestic individuals, and a nine-stage progressive rates shall be adopted for them ranging between 5?45%.
Incorporate Income Tax
    Taxation preferences for foreign-funded productive enterprises. The foreign-funded productive enterprises which invest into the projects other than those of mining resources such as petroleum, natural gas, rare metals and precious metals and whose actual operating term is ten years or longer may be exempted from corporate income tax during the first two years as of the year when they begin to make profits, and from half of the corporate income tax during the third, fourth and fifth years.
    The aforesaid preferential tax policy is also applicable to the foreign-funded enterprises engaging in agriculture, forestry and animal husbandry. In addition, these enterprises may apply to the competent tax department under the State Council and upon approval, may be exempted from 15%-30% of the corporate income tax payable during the next ten years following the said preferential period.