Small, medium and micro enterprises in the manufacturing industry of “precision drip irrigation”

        Manufacturing is the foundation of the real economy, and micro, small and medium-sized enterprises and individual businesses are an important part of the market. Since the beginning of this year, the rise of commodity prices has increased the production cost of manufacturing enterprises, and the development of manufacturing enterprises is facing pressure, among which, the ability of small, medium and micro enterprises to cope with risks is relatively weak.

        To alleviate the pressure of the corporate cash, help enterprises to bail out, thus stabilizing employment, stabilizing economy, recently held a state council executive meeting of the deployment of manufacturing implementation stage tax delay measures such as micro, small and medium enterprises, slow since November 1, the implementation of tax, to the end of the reporting period in January next year, is expected to be for manufacturing micro, small and medium enterprises tax 200 billion yuan.

        With the gradual implementation of the tax delay policy, many market players across the country have enjoyed the policy dividend of “real money and silver”. In an interview with People’s Daily online, experts said that easing the pressure of capital cost in the transformation process of enterprises by delaying tax payment will help solve the difficulties of enterprise bailout.

Policy dividends are targeted at micro, small and medium-sized enterprises in the manufacturing sector

        On the evening of October 29, the State Administration of Taxation and the Ministry of Finance issued a notice on delaying the payment of certain taxes and fees for micro, small and medium-sized enterprises in the manufacturing sector in the fourth quarter of 2021, clarifying the scope and standards of the policy.

        According to the announcement, five taxes and two fees will be deferred for small and medium-sized manufacturing enterprises with annual sales of less than 400 million yuan in the fourth quarter, of which half of taxes and fees will be deferred for annual sales of 20 million yuan to 400 million yuan, and all taxes and fees will be deferred for sales of less than 20 million yuan.

        Specifically, the five taxes and two fees deferred include enterprise income tax, individual income tax (except withholding), domestic value-added tax, domestic consumption tax and attached urban maintenance and construction tax, education fee surcharge, local education surcharge, basically covering the main taxes paid by enterprises.

        The State Council estimated that the move could defer more than 200 billion yuan in taxes for small and medium-sized manufacturing enterprises. A total of 6.21 billion yuan has been deferred for eligible enterprises as of November 4, effectively easing their financial pressure and operating difficulties, Wang Daosu, deputy director of the State Administration of Taxation, said at a regular state Council policy briefing.

        In addition to implementing phased tax deferment policies for micro, small and medium-sized manufacturing enterprises, the tax authorities have also refunded advanced manufacturing enterprises in full amount of incremental VAT retained on a monthly basis and other manufacturing enterprises in full 60% incremental VAT retained on a monthly basis.

        Data showed that in the first three quarters of this year, tax authorities handled 91.7 billion yuan of tax rebates for 22,400 manufacturing enterprises, including 42 billion yuan for 11,600 advanced manufacturing enterprises, further supporting the development of the manufacturing sector.

Phased tax deferral measures add fuel to pay rise for market players

       “Small and micro manufacturing enterprises with annual sales of less than 20 million yuan, like us, can defer most of the tax in the fourth quarter, which is equivalent to an additional short-term interest-free loan, which solves part of our financial difficulties.” “Said Chen Jingui, legal representative of Wisken (Xiamen) Intelligent Technology Co., LTD. It is understood that the implementation of phased tax withholding measures for small, medium and micro enterprises in the manufacturing industry is expected to benefit 41,000 small and micro enterprises in the manufacturing industry in Xiamen, including more than 38,000 small and micro enterprises.

        In Guangdong, Zhongshan Kaiwoneng HVAC Co., Ltd. is a high-tech medium-sized manufacturing enterprise with annual sales of about 48 million yuan. Due to the rising price of raw materials and other factors, the enterprise’s operating costs have increased, which brings no small difficulty to the development of the enterprise.

       “This year, the state has launched tax preferential policies one after another. In October, we declared the additional deduction of R&D expenses for the first three quarters. Now, the tax in the fourth quarter has been halved and the tax is expected to be deferred for 900,000 yuan.” The person in charge of the company said that the tax delay policy not only effectively alleviates the financial pressure of enterprises, but also can invest in the research and development of household heating equipment to open up new markets.

        In Hebei Province, Qinhuangdao Nuclear Nickel Co., Ltd. is a medium-sized manufacturing enterprise with 93 employees and annual sales of more than 87 million yuan. “Due to the epidemic, the prices of raw materials such as iron, nickel and copper have increased by 300% to 400%, labor costs and processing costs have increased by 20% to 30%, and the profit in 2020 is only 720,000 yuan. Manufacturing enterprises are generally facing cash flow difficulties. At the same time, due to the impact of carbon neutrality, the market has higher environmental requirements for product quality, and enterprises are facing the challenge and pressure of product upgrading.” The chief financial officer of the enterprise said that according to the new policy, the enterprise can enjoy about 270,000 yuan of tax delay in the fourth quarter, alleviating the cash shortage near the end of the year, the enterprise uses this money to pre-purchase a new boiler equipment, environmental protection and energy saving at the same time, to further improve product quality.

        Beijing national accounting institute the fiscal and taxation policy and application research institute xu-hong li said in an interview with People’s Daily reporter, this covers the small scope of small and medium-sized enterprises such as large flat tax policy, on the one hand, can reduce the pressure on enterprise capital, help to micro, small and medium enterprises through, on the other hand is helpful to stabilize the market expectations. By sending positive signals to the market and by means similar to short-term interest-free loans, it encourages enterprises to develop and enhance their innovation vitality.

Article source：State Administration of Taxation