Several Policies of the State Council on Encouraging the Development of the Software Industry and Integrated Circuit Industry
Several Policies of the State Council on Encouraging the Development of the Software Industry and Integrated Circuit Industry
Several Policies of the State Council on Encouraging the Development of the Software Industry and Integrated Circuit Industry
the State Council[2000]No.18
June 24, 2007
In order to promote the development of Chinese software industry and integrated circuit industry, reinforce the innovation ability and international competition capability of the information industry, drive the reconstruction of traditional industry and upgrading of products, and further facilitate the sustainable, rapid and sound development of the national economy, these Policies are hereby formulated as follows.
Chapter I Target
Article 1 These Policies aims to encourage the investment of resources such as funds and manpower into the software industry and integrated circuit industry, further facilitate the rapid development of the Chinese information industry, and make efforts to bring up the R&D and production capacity of the Chinese software industry reaching or approaching the advanced international standards.
Article 2 To encourage the domestic enterprises to take full advantage of the international and domestic resources and make efforts to exploit both markets. Through efforts about 5 to 10 years, the domestic software product shall be capable to meet most demand of the domestic market and export in a large number; and the domestic integrated circuit products shall be capable to meet most demand of domestic market and export in certain scale while further narrowing the gap on development and production technologies with the developed countries.
Chapter II Policies on Investment and Finance
Article 3 Funds shall be raised in many ways and the investment on software industry shall be increased.
1. Mechanism of venture capital for software industry shall be established and venture capital on software industry shall be encouraged. Venture capital companies shall be organized and venture capital funds shall be established with support from the state. At the initial stage, the state may arrange partial front-end money, and funds shall be raised by means of directional offering to the public and attracting venture capital fund both at home and abroad. A venture capital company shall be operated and managed with entrepreneurial approaches according to the operation rules of venture capital, and the shares of software enterprise held by such venture capital company shall be capable to access to markets for circulation on the same day of starting listed transaction by such software enterprise. However, a venture capital company acting as sponsor of the software enterprise shall be treated in accordance with the concerning laws and regulations.
2. The Tenth Five-Year Plan shall arrange a proper budgeted capital construction fund for the infrastructure construction and industrialization projects of software industry and integrated circuit industry. A few software technology parks shall be established with support of the state in the regions with concentric scientific manpower such as the colleges, universities and scientific research institutions. When arranging annual plan, the State Development Planning Commission, the Ministry of Finance, the Ministry of Science and Technology and the Ministry of Information Industry shall take out a part of funds assumed by them respectively for the development of science and technology to support the fundamental software development or initial fund of software industry.
Article 4 The way shall be paved for software enterprise to seek financing by listing at home and abroad.
1. The growth enterprise market in securities market shall be opened up as soon as possible. Regardless of the property of ownership, any software enterprise matching conditions to list on growth enterprise market in securities market shall be arranged with privilege.
2. For a software enterprise having promising market prospect and making good use of talent, the proportion of intangible assets in net assets in asset appraisal may be arranged by the investors themselves.
3. The software enterprises shall be supported to seek financing by listing abroad. A software enterprise matching the qualifications of listing abroad after verification shall be permitted to apply for financing by listing abroad.
Chapter III Taxation Policies
Article 5 The state shall encourage the development and production of software products in China. The software products produced and distributed by an average taxpayer of value-added tax shall be subject to a statutory rate of value-added tax at 17% before 2010, and the part of actual tax burdens more than 3% shall be refunded upon payment for software product R&D and extended reproduction of the enterprise.
Article 6 A software enterprise established in China may have the treatment of preferential policies on enterprise income tax. A newly founded software enterprise may, after verification, have the treatment of preferential policies of "Two-exemption & Three-halving" on enterprise income tax as of the profit-making year.
Article 7 Where having not enjoyed the treatment of tax-free privilege at the same year, a key software enterprise listed in the state programming shall be subject to collection of enterprise income tax at a reduced rate of 10%.
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