Page 4 - THE SOUTH CHINA BUSINESS JOURNAL
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PTH
Guangdong-Macao Highlights of
Intensive Cooperation Zone the Guangdong-
Macao ICZ
to Enjoy Free Trade Port Masterplan
Treatment
By Zoey Zhang, China Briefing, Dezan Shira & Associates
China has unveiled a masterplan for residents working there will be subject to lower Innovative administrative system tax (bonded). Meanwhile, goods crossing the “second
constructing the Guangdong-Macao Intensive individual income tax (IIT) liabilities. line” will be subject to stricter customs control.
Cooperation Zone at Zhuhai’s Hengqin island. Guangdong province and Macao SAR will
The masterplan sets out a series of policies, many The idea of the Guangdong-Macao ICZ was jointly form an administrative committee for the Furthermore, for (a) goods that are manufactured
of which are similar to those implemented at initiated around the time of Macao’s 20th Cooperation Zone. The administrative committee by the in-zone enterprises without using imported
the Hainan Free Trade Port (FTP). The policies anniversary celebrations in December 2019, will be run under a “dual director” system, jointly materials and (b) goods that are processed in the
include setting up a special customs supervision presided over by President Xi Jinping. led by the Governor of Guangdong and the Chief CIZ and achieved an added value of not less than
system as well as rolling out financial and tax Executive of the Macao SAR. 30 percent of the original value, these goods can be
incentives for corporates and individuals. As one of China’s two special administrative exempt from import duties when being imported
regions (SARs), Macao’s economy is considered An executive body will be set up under the into the mainland territory from the Zone.
On September 5, 2021, the State Council released the inferior to Hong Kong’s and highly relies on the administrative committee and the person-in-charge
Masterplan on the Construction of Guangdong-Macao gambling and entertainment industry. Macao SAR will be appointed by the Macao SAR government. Preferential tax policies for enterprises
Intensive Cooperation Zone (hereafter “masterplan”), has a narrow land area of merely over 30 square
in a move to diversify Macao’s economy. kilometers and a population of over 600,000. Special customs supervision system Eligible enterprises registered in the Guangdong-Macao
ICZ will be entitled to a corporate tax rate of 15 percent
The Cooperation Zone is located at Hengqin – the Therefore, Beijing hopes the neighboring Hengqin According to the masterplan, for cross-border on business income tax, benefiting all industries that
largest island in South China’s Zhuhai city and in island, which covers 106 square kilometers, trade in goods, the Guangdong-Macao ICZ will set facilitate Macao’s economic diversification.
close proximity to Macao (separated by a river, about three times the size of Macao, can foster up “two lines” under different levels of customs
Hengqin is only 200 meters away from the nearest new industries, contribute to Macao’s economic control – the “first line” is drawn between Hengqin The capital expenditure of businesses that meets the
point of Macao). diversification, and provide a new home for Macao and Macao; and the “second line” is between criteria will be allowed a one-off deduction before
residents to live and work. Hengqin and the Chinese mainland. tax for the taxation period in which the expenditure
According to the masterplan, the Guangdong-Macao occurred or accelerated depreciation and amortization.
Intensive Cooperation Zone (ICZ) will be managed Based on the the plan, the Zone will focus on Customs clearance procedures will be streamlined
under special customs supervision between “two the development of certain industries, including for goods crossing the “first line”. Except for goods Corporate income tax will be exempt on the newly
lines”. Eligible enterprises registered in the Zone sci-tech research and high-end manufacturing, and articles clearly stipulated by the State as items added earnings from foreign direct investment
will be entitled to a reduced corporate income tax traditional Chinese medicine, culture and tourism, not exempt from tax (not bonded), all other goods (FDI) into the tourism, modern services, and high
(CIT) rate of 15 percent. Qualified talents and Macao as well as modern finance. and articles can enter the CIZ from Macao free from technology businesses set up in the Cooperation Zone.
3 AMCHAM SOUTH CHINA SOUTH CHINA BUSINESS JOURNAL 4
Guangdong-Macao Highlights of
Intensive Cooperation Zone the Guangdong-
Macao ICZ
to Enjoy Free Trade Port Masterplan
Treatment
By Zoey Zhang, China Briefing, Dezan Shira & Associates
China has unveiled a masterplan for residents working there will be subject to lower Innovative administrative system tax (bonded). Meanwhile, goods crossing the “second
constructing the Guangdong-Macao Intensive individual income tax (IIT) liabilities. line” will be subject to stricter customs control.
Cooperation Zone at Zhuhai’s Hengqin island. Guangdong province and Macao SAR will
The masterplan sets out a series of policies, many The idea of the Guangdong-Macao ICZ was jointly form an administrative committee for the Furthermore, for (a) goods that are manufactured
of which are similar to those implemented at initiated around the time of Macao’s 20th Cooperation Zone. The administrative committee by the in-zone enterprises without using imported
the Hainan Free Trade Port (FTP). The policies anniversary celebrations in December 2019, will be run under a “dual director” system, jointly materials and (b) goods that are processed in the
include setting up a special customs supervision presided over by President Xi Jinping. led by the Governor of Guangdong and the Chief CIZ and achieved an added value of not less than
system as well as rolling out financial and tax Executive of the Macao SAR. 30 percent of the original value, these goods can be
incentives for corporates and individuals. As one of China’s two special administrative exempt from import duties when being imported
regions (SARs), Macao’s economy is considered An executive body will be set up under the into the mainland territory from the Zone.
On September 5, 2021, the State Council released the inferior to Hong Kong’s and highly relies on the administrative committee and the person-in-charge
Masterplan on the Construction of Guangdong-Macao gambling and entertainment industry. Macao SAR will be appointed by the Macao SAR government. Preferential tax policies for enterprises
Intensive Cooperation Zone (hereafter “masterplan”), has a narrow land area of merely over 30 square
in a move to diversify Macao’s economy. kilometers and a population of over 600,000. Special customs supervision system Eligible enterprises registered in the Guangdong-Macao
ICZ will be entitled to a corporate tax rate of 15 percent
The Cooperation Zone is located at Hengqin – the Therefore, Beijing hopes the neighboring Hengqin According to the masterplan, for cross-border on business income tax, benefiting all industries that
largest island in South China’s Zhuhai city and in island, which covers 106 square kilometers, trade in goods, the Guangdong-Macao ICZ will set facilitate Macao’s economic diversification.
close proximity to Macao (separated by a river, about three times the size of Macao, can foster up “two lines” under different levels of customs
Hengqin is only 200 meters away from the nearest new industries, contribute to Macao’s economic control – the “first line” is drawn between Hengqin The capital expenditure of businesses that meets the
point of Macao). diversification, and provide a new home for Macao and Macao; and the “second line” is between criteria will be allowed a one-off deduction before
residents to live and work. Hengqin and the Chinese mainland. tax for the taxation period in which the expenditure
According to the masterplan, the Guangdong-Macao occurred or accelerated depreciation and amortization.
Intensive Cooperation Zone (ICZ) will be managed Based on the the plan, the Zone will focus on Customs clearance procedures will be streamlined
under special customs supervision between “two the development of certain industries, including for goods crossing the “first line”. Except for goods Corporate income tax will be exempt on the newly
lines”. Eligible enterprises registered in the Zone sci-tech research and high-end manufacturing, and articles clearly stipulated by the State as items added earnings from foreign direct investment
will be entitled to a reduced corporate income tax traditional Chinese medicine, culture and tourism, not exempt from tax (not bonded), all other goods (FDI) into the tourism, modern services, and high
(CIT) rate of 15 percent. Qualified talents and Macao as well as modern finance. and articles can enter the CIZ from Macao free from technology businesses set up in the Cooperation Zone.
3 AMCHAM SOUTH CHINA SOUTH CHINA BUSINESS JOURNAL 4
