SUBSIDIES
Replies
to Follow-up QUESTIONS POSED BY CANADA[1]
TO REPLIES PROVIDED BY CHINA[2] REGARDING THE
2023 NEW AND FULL NOTIFICATION OF CHINA[3]
The following communication, dated and received on 31
March 2025, is being circulated at the request of the delegation of Canada.
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I._
Subsidies at the Central Government Level
Question 1
In response to Canada's question on subsidies
related to the COVID-19 pandemic, China explained that the Chinese Government
introduced a series of phased and inclusive tax incentive policies in response
to the COVID-19 pandemic.
a._
Could China please indicate if these tax incentive
policies were reflected in its 2023 subsidy notification? If so, where?
b._
If these policies were not reflected in the 2023
subsidy notification, could China please explain why?
Reply to both (a) and (b):
The tax incentives provided by China during
the COVID-19 pandemic, such as tax and fee reduction policies to support the manufacturing
industry, small and micro enterprises, and individual businesses, have been notified
in different programs of the 2023 subsidy notification, including Programs 4
and 18 under the central policy.
Question 2
In response to Canada's question on Program 3
(Preferential Tax Policies for High-Tech Enterprises), China referred to the
"Measures for the Administration of the
Recognition of High-tech Enterprises" (GKFH [2016] No. 32)
regarding the criteria used to categorize an enterprise as a "high or new
technology enterprise".
a. Could China please provide the
criteria used to categorize an enterprise as a "high or new technology
enterprise" in writing as the website link previously provided is not
operational.
Reply:
Please refer to the official
website of the Ministry of Science and Technology:
https://www.most.gov.cn/tztg/201112/w020111223623723909056.pdf
Question 3
In response to Canada's question on Program
46, (Fund for Energy Conservation and
Emission Reduction), China mentioned that the relevant content of
"Fund for Energy Conservation and Emission Reduction" can be found on
two websites.
a._
China did not provide an answer concerning the maximum
amount of funding available for an individual grant provided under this
program. Could China please clarify what is the maximum amount for an
individual grant?
b._
Also, China stated that the specific subsidy amount
under this policy will be settled based on the "actual situation".
Could China please explain what they mean by "actual situation"? What
factors are taken into consideration to determine the "actual
situation"?
Reply to both (a) and (b):
The allocation of fund for energy
conservation and emission reduction considers factors including work targets,
investment costs, effectiveness of conservation and reduction measures, and the
level of comprehensive energy resource utilization. "Actual
situation" refers to the implementation status of projects supported by
such fund, such as the development of basic capabilities and public platforms
for energy conservation and emission reduction, as well as the demonstration,
promotion, and upgrading of key energy conservation and emission reduction
technologies.
Question 4
In response to Canada's question on Programs
53, 54, 55, 56 and 57 on whether tax exemptions were applied automatically or
if enterprises had to request them, China mentioned that the "Project
Cities" refer to the cities where the central government supports clean
heating projects in the northern region.
a._
Canada notes that "Project Cities" are not
referred to in these program entries in China's 2023 subsidy notification.
Could China clarify what this is in reference to?
b._
China did not provide an answer indicating if the tax
exemptions are applied automatically or if enterprises have to request them and
if the latter, what is the process? Could China please clarify?
Reply to both (a) and (b):
"Project Cities" refer
to cities supported by central finance for clean winter heating in northern
regions and selected based on merit by the Ministry of Finance, Ministry of
Housing and Urban-Rural Development, Ministry of Ecology and Environment, and
National Energy Administration. Supported cities receive fixed subsidies for
clean heating renovation to facilitate their clean heating renovation.
Taxpayers shall self-assess
their eligibility for the aforementioned preferential treatment. If they believe
that they are eligible, they may enjoy relevant preferential treatment
immediately upon submission of their tax returns.
II._
Subsidies at the Sub-Central Government Level
Question 5
In response to Canada's question on Program
13.2 (Special Fund for Marine Service and
Fishery High Quality Development) regarding the eligibility
requirements to receive support under this program, China described the scope
of the fund, but did not provide a response to the question on eligibility
requirements.
a._
Could China please indicate if there are any
eligibility requirements to receive support under this program? If so, what are
they?
Reply:
The
fund was operational from 2022 to 2024, and has now expired and is no longer in
effect.
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