China's four-year extension of individual income tax policies for foreign nationals will make it easier for companies to hire international staff, said the German Chamber of Commerce in China in a statement issued on Tuesday.
The German commerce chamber's comments came after China's Ministry of Finance released a notice detailing the continuation to implement preferential income tax policies for foreigners on Monday.
Under this policy, certain allowances for foreigners are exempt from individual income tax, such as housing allowances and children's education fees. The policy will come into effect Dec 31, 2027. This announcement follows the State Council's, China's Cabinet, issue of a 24-point guideline in mid-August to attract more global capital and enhance the environment for foreign investment.
According to the chamber's statement, extending the policy well in advance gives planning time for companies and will help keep related costs at bay.
"We have been advocating for this policy extension at both central and local levels, for instance by corresponding with the Chinese Minister of Finance. We are thrilled to see that the joint effort of the foreign business community has been successful," said the German commerce chamber.