China has come up as a major economic power in the world and is arguably one of the most affluent nations. In terms of nominal GDP it stands 4th in the world. The nominal GDP of China in the year 2006 was estimated to be about 2.527 trillion USD. In terms of purchasing power parity the GDP of the country was estimated to be about 10.21 trillion USD in the year 2006. China is now regarded as one of the most rapidly growing nations. The economy of China has been through huge developments with the implementation of its liberalization policies. China has set up a number of free trade zones (FTZ) that has really helped in setting up more number of industries within a very short period of time. The preferential policies for FTZ in China has ensured that more amount of foreign investments come to the country.
The preferential policies for FTZ in China include the tax policies of varied kinds. The equipments that are imported from other nations are exempted to a certain percentage from the custom duties. Even the materials that are imported for the purpose of construction and other materials for office use are also exempted from various taxes that are levied.
There are many advantages of the free trade zones in China and thus they attract a great number of foreign companies to start up their centers in the country.
Preferential policies for FTZ in China suggest that the products that enter the free trade zones are made free from any taxes. Even the goods that goes from the free trade zones to other nations are made free from tariffs. There are certain materials that are imported from other countries to be again exported to other nations after processing. In this case too, no taxes are levied by the customs department. In some of the cases where imported materials after being processed are sold in the domestic markets some taxes as well as tariffs are levied by the customs.
Preferential policies for FTZ in China makes it sure that the goods being sold in the domestic market after they are processed from the imported materials are taxed as per the value of the imported goods. As per the preferential policies for FTZ in China, the business organizations that would operate in the free trade zones are entitled for a number of tax benefits. For instance in a particular FTZ during the first two fiscal years, the company no tax at all has to be given. From the 3rd till the 5th year taxes are levied by the customs at a reducing rate of 7.5 %.
The most interesting thing about the preferential policies for FTZ in China is that there is no quota for goods that enter or leave from the free trade zone. Even no import license is required. There are also no requirements for export license. For the processing of the trade deposit, account system is always canceled.
To know more about free trade zone services in China, browse through the pages of www.chineseftz.com.
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