1. The province shall levy a preferential 15 percent flat income tax on foreign invested manufacturing enterprises established in the state economic and technological development zones. And it shall levy a preferential 24 percent flat income tax on foreign-funded manufacturing enterprises built the cities where state economic and technological development zones have been established and those in the economic and technological cooperation zones developed in the border areas. Of these enterprises, those technology intensive, or knowledge intensive projects, projects costing an investment of more than 30 million yuan that takes a longer time to recover, and projects involved in the construction of energy, transportation and harbor, shall be levied a preferential 15 percent flat income tax upon approval by the State Taxation Administration.

2. Foreign invested productive enterprises whose effective duration of operation will be 10 years or longer shall be exempt from the income tax starting from the first profit-making year to the second year; and their income tax will be reduced 50 percent from the third year to the fifth year. Foreign-invested enterprises that are ascertained as of advanced technology shall be levied on a 50 percent reduced income tax for another extended three years following the expiration of the term of exemptions and reductions as mentioned above on condition that they remain as a technologically advanced enterprise. Following the expiration of the term for tax exemptions and reductions, those foreign-invested productive enterprises shall be allowed a preferential 15 percent to 30 percent reduced income tax in the following 10 years on approval of their applications by the State Taxation Administration.

3. Any foreign invested export-oriented enterprise, following the expiration of the term of exemptions and reductions of the income tax, and when its export products reached 70 percent or more of the total output value in the year, shall be levied on a 50 percent reduced income tax. Those export-oriented enterprises that have already enjoyed a preferential 15 percent flat income tax shall continue to enjoy a preferential 10 percent flat income tax when they have met the requirements as said above.

4. When foreign investors reinvest their share of profit into the same enterprises to increase their registered capital or set up other foreign investment enterprises within a period of less than five years, they should be refunded 40 percent of the income tax paid on the reinvested amount.

5. Foreign-invested manufacturing or trading enterprises who suffer a yearly loss and cannot afford paying income tax of the tax year are allowed to make up the balance the next year, or in the following years within a period not exceeding five years.

6. Foreign-invested manufacturing enterprises whose duration of operation will be 10 years or longer, shall be exempt from the local income tax for a period of 10 years starting from the first profit-making year. Following the expiration of the term for exemptions, they shall be exempted from the local income tax in the same year on condition that the output value of their export products have reached more than 50 percent of the total output value of the enterprise in that year. Those foreign-invested enterprises, encouraged to be set up by the province, shall be levied on a 50 percent reduced local income tax for a period of five years, if they find it difficult to pay the tax following the expiration of the term of exemptions. Any such enterprise that has been given preferential exemptions and reductions of the income tax by the state should receive the same treatment of the exemptions and reductions in terms of local income tax.

Land-use right:

1. When the land is used for a project of city infrastructure construction, which is exclusively funded by a foreign investor, its use-right can be obtained through governmental allocation.

2. When the land is used for such foreign invested projects as encouraged by the government, or those for agriculture, forestry, animal husbandry, and fishery projects funded by foreign investors, and when the investors have brought the land-use right, the land-user can transfer, lease or mortgage the land according to law within the effective period of the land-use contract. Those who obtained the land-use right by paying yearly rent shall be exempted from paying the rent for the first five years beginning from the date when they get the right to use the land. Their rent should be reduced 50 percent from the sixth year to the tenth year.