Shenzhen High-Tech Industrial Park
Introduction
Economic Scale Advantage
Shehzhen Special Economic Zone is the first special economic zone whose establishment was initiated and promoted by Deng Xiaoping, the chief designer of Chinese reform and opening. As an experiment for promoting the development of economic and social development of China, Shenzhen has formed a characteristic economy featuring high-tech industry, logistics, finance and information services. Various social causes have enjoyed simultaneous development and a market economy system has been increasingly perfected. Shenzhen has set an example to the whole country and played a role of example and promotion. In 2002, its GDP reached 223.941 billion. Its total import and export amount was USD 87.1 billion, including an export value of USD 46.52 billion. Its total industrial output value was RMB422.1 billion. The output value of high-tech industry accounted for 46% of the total industrial output value. By the end of 2002, the accumulated amount of foreign capital actually utilized reached USD 31.519 billion.
Geographical Advantage
Shenzhen is located at the forefront of the Pearl River Delta and borders on the New Territories of Hong Kong in the south, Daya Bay in the east, the outlet of Pearl River and Dongguan and Huizhou in the north, being an important coastal communication hub in South China. Shenzhen is the only city that ouns seaports, airport and land ports in China. Its seaports are especially developed. The Shenzhen Port ranks sixth among world container ports. Shenzhen owns Luohu Ports, the largest land passenger port in China and Huanghang Port, the largest land freight port. At the same time, Guangshen, Shenshan, Jingjiu and Guangshen expressways link Hong Kong, Shenzhen and inland cities, 24-hour customs clearance practiced by Shenzhen and Hong Kong ports, electronic inspection and release and the commencement of construction of the west Bridge will make Shenzhen and Hong Kong connected more closely. The regional advantages of Shenzhen will be further highlighted and the economy of both Shenzhen and Hong Kong can further thrive. Besides, Shenzhen is a bridge linking Hong Kong with inland area and linking inland area with the world.
Supporting Industry Advantage
Shenzhen is a production base, R&D base and transaction base of high-tech products including computer and parts, communication equipment, audio visual products, optical and electromechanical products, biological engineering products, etc. Shenzhen has over 1500 factories producing supporting parts of computer, which produce almost all computer parts except chips. Their annual supporting ability is over 30 million sets. There are over 30 million lines for communication and exchange. Shenzhen has become an electronic supporting center in mainland China. China International High-tech Result Fair is held in Shenzhen once every year.
Immigrant Culture Advantage
There is a saying is China that the world is won with culture. Shenzhen is a newly emerging immigrant city. Its culture is different from the traditional culture of other cities. It is the trans formation and activation of inland culture and the absorption and fusion of foreign culture oriented toward Hong Kong. Unique geological and cultural environment of Shenzhen has created Shenzhen culture featuring openness, tolerance and innovation.
Environment
|
1.Natural Environment 2.Infrastructure 3.Cultural Environment |
Investment Direction
High Technology
Shenzhen focuses on developing the industries of computer and parts, very large-scale integrated circuit, network and communication, software, photoelectron, digital electrical household appliances, biological engineering, new material and environmental protection and renovates traditional industries by making use of high technology and advanced applicable technologies.
Logistics Business
Shenzhen encourages the development of port supporting facilities, multi-modal container transport, modernized warehousing area, international express distribution center, logistics park, whole-course logistics network, distribution and delivery center, chain operation network and city light rail facilities.
Finance Industry
Shenzhen fosters the development of securities, insurance and banking industry and the establishment of foreign-invested companies engaged in financial consultation, trust investment, financial consultation, trust investment, finance, fund management, veture investment and venture investment management.
Tourism Industry
Shenzhen focuses on developing modern tourism industry integrating recreation, culture and ecology.
Other Fields
Investment in traditional industries including important infrastructure, refined chemical industry, automobile parts, clocks and watches, jewelry, leather, furniture and garment and establishment of high-class joint venture hospitals, international schools and other projects.
Investment policies
I. Tax Policies
1.Income tax
Income tax is a kind of tax enjoyed by the central and local government. Under general conditions, the central government levies income tax at the rate of 30%. The local government levies income tax at the rate of 3%. Foreign-invested enterprises satisfying the following conditions may enjoy corresponding income tax incentives:
(1) For foreign-invested enterprises, corporate income tax rate stands at 15% while the local income tax levied at the rate of 3% is also exempted.
(2)Foreign-invested enterprises engaged in the development and operation of ports, wharves, energy and traffic projects with duration of over 15 years may enjoy 5 years of corporate income tax exemption from the profit-making year and half reduction for the ensuing 5 years.
(3) Manufacturing foreign-invested enterprises may enjoy 2 years of corporate income tax exemption from the profit-making year and half reduction for the ensuing 3 years. Export-oriented enterprises at the expiration of tax exemption and reduction period enjoy a reduced rate of 10% for income tax provided the export volume accounts for 70% of the total industrial output. Manufacturing enterprises using state-of-the-art technology at the expiration of tax exemption and reduction period are entitled to a reduced tax rate of 10% for a 3-year extension.
(4) The foreign-invested enterprises engaged in service sector with investment of over USD 5 million and duration of over 10 years may enjoy 1 year of corporate income tax exemption from the profit-making year and half reduction for the ensuing 2 years.
(5) Sino-foreign joint venture or foreign banks established in Shenzhen Economic Special Zone with total investment of over USD 100 million and duration of over 10 years may enjoy 1 year of corporate income tax exemption from the profit-making year and half reduction for the ensuing 2 years.
(6) Manufacturing high-tech foreign-invested enterprises may enjoy 2 years of corporate income tax exemption and half reduction for the ensuing 6 years. At the expiration of tax exemption and reduction period, such enterprises enjoy a reduced rate of 10% for income tax provided the export volume accounts for 70% of the total industrial output.
(7) High-tech result transformation projects owning independent intellectual property right may enjoy 5 years of corporate income tax exemption and half reduction for the ensuing 3 years. After the new projects constructed by high-tech enterprises by absorbing and digesting high technologies are put into production, such enterprises may enjoy the exemption from corporate income tax for three years on the profit obtained from such projects regardless of previous tax incentives.
(8) The municipal financial authority shall return 100% of the income tax actually paid for the profit increased by state-level new products or the invention patented products first produced in Shenzhen and provincial/municipal-level new products and utility model patented products first produced in Shenzhen within three years (for the first case) or two years (for the latter case) from the date of sales.
(9) Software enterprises may enjoy 2 years of corporate income tax exemption from the profit-making ear and half reduction for the ensuing 3 years. Those certified as high-tech enterprises may enjoy 2 years of corporate income tax exemption and half reduction for the ensuing 6 years. Key software enterprises enjoy 5 years of corporate income tax exemption and half reduction for the ensuing 5 years. For the corporate income tax paid for the third to fifth year which is levied at half reduced rate, the municipal financial authority shall provide corresponding allowance. If key software enterprises did not enjoy tax incentives in the current year, the corporate income tax shall be levied at the rate of 10%.
2.VAT
The rate of VAT is 17%. A low rate of 13% is provided. Foreign-invested enterprises satisfying the following conditions may enjoy corresponding tax incentives:
(1) As for high-tech result transformation projects with independent intellectual property right, 50% of the local-sharing portion of VAT shall be returned by municipal authority for eight years.
(2) the municipal financial authority shall return 50% of the local-sharing portion of VAT increased by state-level new products or the invention patented products first produced in Shenzhen within three years (for the first case) or two years (for the latter case) from the date of sales.
(3) Simultaneous levy and refund is applied to the part exceeding 3% of the total VAT paid by software enterprises that are general taxpayers of VAT at the statutory tax rate of 17% for the sales of independently developed software products before the end of 2010. The refunded tax shall not be subject to the levy of corporate income tax.
(4) Simultaneous levy and refund is applied to the part exceeding 6% of the total VAT paid by integrated circuit manufacturers that are general taxpayers of VAT at the statutory tax rate of 17% for the sales of self-produced integrated circuit products. The refunded tax shall not be subject to the levy of corporate income tax.
(5) Self-use equipment and relevant technologies (including software), supporting parts and spare parts imported by software enterprises are exempt from tariff and import-related VAT.
(6) Integrated-circuit technologies, complete set of production equipment, equipment and apparatuses specially for integrated-circuit, self-use raw materials and consumables for production imported by integrated-circuit manufacturing enterprises are exempt from tariff and import-related VAT.
(7) 50% of the additional local-sharing portion of VAT will be refunded to the high-tech enterprises and high-tech projects within three years with the figure of the previous year as the base.
(8) The additional local-sharing portion of VAT will be refunded to the computer software reaching domestically advanced level whose annual sales amount exceeds RMB 10 million within three years.
3.Business tax
Business tax is divided on trade basis. Business tax rate ranges between 3%-20%. The business tax rate applicable to traffic, transportation and construction is 3%. The business tax rate applicable to commercial service, insurance and entertaining business is 5%, 8% and 20% respectively. Foreign-invested enterprises satisfying the following conditions may enjoy corresponding tax incentives:
(1) Foreign banks or sino-foreign equity joint venture banks with a duration of over 10 years and total investment of over RMB 100 million are exempt from business tax for the income from financial business for 5 years commencing on the date of opening.
(2) High-tech result transformation projects owning independent intellectual property right may enjoy 5 years of business tax exemption and half reduction for the ensuing 3 years.
4.Individual income tax
Individual income tax adopts progressive tax rate in excess of specific amount. The part of monthly wage of domestic employees exceeding RMB 1,600 is subject to individual income tax, The part of monthly wage of foreign employees exceeding RMB 4,000 is subject to individual income tax. The individual income tax rate has 9 levels and ranges between 5%-45%. The individuals satisfying the following conditions may enjoy corresponding tax incentives:
If the shares rewarded and distributed by high-tech enterprises and high-tech projects to their employees are reinvested in their production and operation, individual income tax shall be exempted. If dividends have been paid or transferred, individual income tax shall be levied according to the actual amount of gains.
II. Financial Subsidy
Shenzhen established software enterprise development center. The government shall provide subsidy to new software enterprises entering the center from special fund for science and technology.
Shenzhen established integrated circuit industrial park. Integrated circuit manufacturers approved to enter the park shall be exempted from transfer fee of land use right, fee of municipal support facilities and land development fee. For the integrated circuit manufacturers that start operation prior to 2005, the charge for electricity and water (including discharge fee) for production use is respectively RMB 0.5 per kWh and RMB 1.5 per ton. Financial subsidy shall be given to the part of charge for electricity and water exceeding the above standard within 5 years. Municipal financial authority shall give subsidy in respect of power supply (distribution) according to actual conditions.
III. Land Policies
1. Half of the land use fee for the land for industrial use utilized by certified export-oriented enterprises will be exempted. Half of the land use fee for the certified enterprises using advanced technology will be exempted for 5 years.
2. The transfer fee of the land use right of the land for scientific research and production of high-tech enterprises or high-tech projects shall be exempted. Te transaction commission, property right registration fee and relevant charge in connection with the purchase of premises shall be exempted. The deed tax shall be returned by the financial authority according to the amount of actual payment.
3. The house property tax payable for the premises built or purchased by high-tech enterprises or for high-tech projects shall be exempted within five years from the date of construction completion or purchase.
IV. Encouraging Fund
1.The municipal government shall appropriate special fund for supporting the development of software industry.
2.The municipal governmental shall appropriate science and technology fund and encourage enterprises to make more investment in science and technology.
3.The municipal government shall appropriate fund as the undertaking initiation subsidy to returned personnel. Certain proportion of science and technology fund shall be allocated each year to support the returned personnel who bring high-tech results and projects to Shenzhen and be engaged in transformation of technical results and the R&D of high-tech projects.
4.Domestic and foreign universities and scientific research institutes are encouraged to establish bases integrating production, study and research, bases for transforming technical research results, training centers, post-doctoral mobile working stations, etc. in Shenzhen through cooperation and be engaged in scientific research, technology development and personnel training. Shenzhen virtual University Park shall be built in the high-tech industry area. Office facilities, network and communication equipment, etc. shall be provided to the universities entering the park free of charge. Enterprises are encouraged to set up engineering technology R&D centers and post-doctoral mobile stations. Municipal government shall give financial support of RMB 5 million and 3 million respectively to each center and station of state level and municipal level and subsidy of RMB 50,000 to each postdoctor entering the center and working station each year.
V. Personnel Policies
1.The professionals with regular college education or above who have worked in high-tech enterprises for over two years may have permanent registered residence in Shenzhen. The personnel transferred in with university education or above or professional title of technician or above shall be exempted from city infrastructure expansion fee. The spouses of the personnel with semi-senior professional title or above and returned personnel needed by high-tech enterprises and high-tech projects may be transferred in with them simultaneously. If the returned personnel work in Shenzhen, their children shall enjoy the same treatment given to permanent residents of Shenzhen in respect of admission to schools.
2.Software system analysts and system engineers engaged in software work and software development personnel with university education or above, or college education or above and semi-senior professional titles or above or with important inventions and creations, their spouses and minor children are allowed to settle in Shenzhen (irrespective of transfer with spouse or work transport) and exempted from city infrastructure expansion fee.
3.If the domestic and foreign senior professional technical and managing personnel engaged by integrated circuit manufacturers purchase commodity residential houses in Shehzhen, the payment for such courses may set off their taxable income and the method of refund after levy may be adopted.
4.If the domestic and foreign senior professional technical and managing personnel needed by integrated circuit manufacturers purchase commodity residential house settle in Shenzhen, they shall be free from the restriction of the norm of registered permanent residence of Shenzhen and enjoy exemption of city infrastructure expansion fee.
5.Municipal government shall create ¡°shenzhen Science and Technology Contribution Prize (Mayor¡¯s Prize)¡± to handsomely reward the technical personnel who have made outstanding contribution to the industrialization of high-tech results of Shenzhen and created great economic benefits.
VI. Intellectual Property Right
China has promulgated a series of laws and regulations on the protection of intellectual property rights including the Patent Law of the People¡¯s Republic of China, the Copyright Law of the People¡¯s republic of china and the Regulations on the Protection of Computer Software. Relevant governmental agencies of Shenzhen have attached great importance to the management and protection of intellectual property right, made efforts to sharpen the social awareness of protecting society, resolutely investigated and punished various actions of infringement upon intellectual property rights and timely handled the disputes over intellectual property rights.
VII. Miscellaneous
1.Integrated circuit manufacturers may set aside 15% of the net sales as R&D fee. If the R&D fee drawn is not used up in the current year, the balance may be carried over to the next year. If the investment of an enterprise in R&D exceeds the amount of R&D fee drawn, the exceeding part may be stated as R&D expenses.
2.Accelerated depreciation may be conducted to the production and research equipment of high-tech enterprises and high-tech projects. The shortest depreciation term of the production equipment of integrated circuit manufacturers may be three years.
Investment Cost
1.WaterThe planned water supply is 412 tons daily, with average water consumption of 2.96 million tons
per day.
| Domestic water | 1.5yuan/m3 |
| Industrial water | 1.9yuan/m3 |
| Water for commerce, service industry and construction industry | 3.4yuan/m3 |
2.Electricity
|
Unit:yuan/kwh
|
|
-
|
Common Electricity
|
Large amount of electricity comsumption from 101 to 3000kVA
|
High demand on electricity consumption of over 3001kVA
|
| Domestic and agricultural electricity |
0.73
|
||
| Electricity for commerce and service industry |
0.89
|
0.77
|
0.72
|
| Industrial electricity (including some dirculation industries) |
0.75
|
0.65
|
0.6
|
3.LPG
| Domestic gas | 10.37yuan/m3 |
| Comercial gas | 13.48yuan/m3 |
4.Communications
1)Fixed network communications fees
| Basic monthly rental for non-residential users | 35 yuan per month for each telephone set | |
| Local call fees | Within operation area Operation segments | 0.22 yuan for the first 3 minutes, and 0.11 yuan for each minute since the fourth minute 0.20 yuan/once (1 minute for each time) |
| Toll fees | Domestic International Hong Kong, Macao, and Taiwan | 0.07 yuan/6 seconds 0.8 yuan/6 seconds 0.2 yuan/6 seconds |
2)Mobile communications fees
| Domestic water | Basic monthly rental 50 yuan per user per month |
| Industrial water | 0.4 yuan per minute |
| Water for commerce, service industry and construction industry | Basic mobile conversation fees+Corresponding toll call fees |
3)Internet service
|
-
|
Openning account and installation (yuan per subscriber)
|
Network access fees (yuan per subscriber per month)
|
Remarks
|
| ADSL virtual dialing |
880
|
630
|
Commercial user
|
| IP MAN(5M) |
1000
|
2800
|
Commercial user
|
| ADSL virtual dialing |
380
|
200
|
Residential user
|
The communications fees mentioned above are the basic ones stipulated by telecommunications companies, and the communications cost can be reduced by a big margin by employing the IP conver sation mode or the preferential service packages design by the telecommunications companies.
5.Price on assignment of land use right
|
Unit:yuan per square meter for building area
|
|
-
|
Nanshan Dist
|
Futian Dist
|
Luohu Dist
|
Yantian Dist
|
Longgang Distand Baoan Dist
|
| Commercial land |
1368-2579
|
1338-5509
|
1260-8039
|
1260-2184
|
579-1320
|
| Office area |
1225-1968
|
1225-2792
|
1202-3144
|
1078-1732
|
-
|
| Residential land |
679-1983
|
715-2564
|
816-2923
|
715-1388
|
423-854
|
The prices on the assignment of land use right listed above are for reference, and the prices shall subject to negotiation with property owners or through bidding and tender.
|
Unit:yuan/m2
|
|
-
|
Longgang Grand Industrial Area
|
Hi-Tech Industrial Park
|
Futian Bonded Area
|
| Price of land |
145-200
|
130-170
(multiplies building area) |
800-2800
|
6.Rent of office building/workshop/warehouse
|
Unit:yuan per meter per month
|
|
-
|
Nanshan Dist
|
Futian Dist
|
Luohu Dist
|
Yantian Dist
|
Longgang Distand
|
Baoan Dist
|
|
| Office building | Highrise |
13-48
|
30-70
|
35-130
|
25-65
|
6-55
|
8-60
|
| Multi-storey |
14-50
|
30-60
|
15-45
|
-
|
-
|
-
|
|
| Workshop |
12-28
|
15-40
|
8-15
|
13-22
|
4-13 |
5-14
|
|
| Warehouse |
10-17
|
-
|
6-10
|
10-25
|
4-8 |
4-14
|
|
7.Average pay for employees
|
Unit:yuan per month
|
|
-
|
Mannagement personnel
|
professional technical personnel
|
Production personnel
|
||||
|
-
|
-
|
-
|
Senior technical personnel
|
Technical
|
Senior
|
Intermediate
|
Junior
|
|
Within SEZ
|
2100-20000
|
1800-13000
|
3200-7000
|
2600-6500
|
1200-5400
|
900-4000
|
680-3600
|
|
Out of SEZ
|
1000-8000
|
1100-8200
|
2100-4900
|
2000-4400
|
1100-4000
|
750-3300
|
610-2500
|
The labor cost mentioned above is an intermediate level and, according to Shenzhen’s regulations, the
lowest monthly pay within the SEZ is 595.00 yuan, while the lowest pay out of the SEZ is 46.00 yuan. 8.Insurance
premium
|
-
|
-
|
Undertaken by enterprises
|
Undertaken by individuals
|
Remarks
|
|
Social endowment insurance
|
Basic pension insurance
|
8%
|
5%
|
|
|
Local supplementary pension insurance
|
1%
|
-
|
||
|
Basic medical insurance
|
Comprehensive medical insurance
|
7%
|
2%
|
Permanent residents
|
|
Hospitalization medical insurance
|
-
|
2%
|
Temporary residents
|
|
|
Employment injury insurance
|
6.4-19.4
|
-
|
yuan per person per month
|
|
| Unemployment insurance |
8.6
|
-
|
yuan per capita per month
|
|
| Public accumulation fund for housing construction |
15%
|
-
|
||
| Total approximate insurance premium |
31%
|
9%
|
||
Note: The insurance premiums with % are to be calculated and drawn as per monthly pay. 9.Industrial and
commercial registration charge
| 0.08% of the total registered capital below 10 million yuan (including 10 million yuan); additional 0.04% for the sum exceeding 10 million yuan; and no more will be collected for the part exceeding 100 million yuan. |
10.Cost of capital construction
| The cost of construction for industrial workshops is about 500-1000 yuan per square meter. |
11.Cost of transportation 1)Cargo keeping and service fees for customs supervision warehouse
|
Unit of charging: per day
|
|
-
|
Indoor warehouse
|
Outdoor warehouse
|
|
| Common cargos |
3.7 yuan per square meter
|
0.8 yuan per square meter
|
|
| Container |
20 feet
|
-
|
25 yuan for each
|
|
40 feet
|
-
|
50 yuan for each
|
|
| Vehicle |
-
|
25 yuan per vehicle
Note: 8 tons to 10 tons |
|
2)Cost of transportation of containers
|
Yuan per container
|
|
-
|
Yantian Port
|
Shekou Port and Chiwan Port
|
| Within SEZ |
650-750
|
600-700
|
| Out of SEZ |
750-850
|
700-800
|
Possibly Related Posts:
- Working in China, the Untold
- Xin’an Ancient City, Nanshan District, Shenzhen, China
- Hehu New Houses, Longgang District, Shenzhen, China
- Deng Xiaoping’s Portrait, Futian District, Shenzhen, China
- Shenzhen legislates for kidnapping in School