To promote foreign investment in China, China has rolled out a policy of "deferral of withholding tax". The policy provides that profits distributed to foreign investors from residents of China, which are used for domestic direct investment, as long as the profits comply with certain conditions, can enjoy the deferral of withholding income tax policy for the time being. Xiamen tax department actively implements this policy and screens out the eligible foreign-funded enterprises for proactive contact. Statistics show that the taxation department has accepted 12 tax deferral filings in Haicang District alone since 2020. The relevant enterprises have enjoyed dividends of RMB 450 million from the deferral of withholding tax, up 55% over 2019. The tax business environment has further improved, effectively boosting the expansion and sustainable development of foreign investment.
