Tax authorities ease burden on Little Giant companies

"Little Giant" Enterprises in Zhuhai have received combined tax reductions of more than 100 million yuan ($15 million) in the first half of this year due to the efforts of local taxation authorities.

"Little Giant" refers to those small and medium-sized companies that own core technologies, strong innovation capabilities, large market shares, and high profitability. The Ministry of Industry & Information Technology has approved them to promote the specialized, elaborative, characteristic, and innovative development of SMEs.

Knowing how capital-consuming scientific research can be, the tax department helped the "Little Giants" apply for preferential tax policies person-to-person so that they could have more funds to attract talents, purchase scientific research equipment, and improve innovation ability.

Taxation officer explains policies to Jieli Technology personnel. The enterprise deals in SoCs (system-on-a-chip) for RF and multimedia intelligent terminals[Photo courtesy Zhuhai Daily]

Among the local beneficiaries are Zhuhai Orbita Aerospace Science & Technology in Tangjiawan, InnoGetic Technology in Qianshan, Energy New Materials Technology in Jinwan District, and Jieli Technology in Nanping.

At Orbita, for instance, a dedicated guideline was compiled by taxation authorities to detail various reductions eligible for software and integrated circuit companies. In addition, one-on-one services were offered so the satellite producer and operator could quickly benefit from policy bonuses.

Orbita financial executive Zhou Mi said the IC industry usually receives heavy capital input early on followed by a long payback period. Zhuhai taxation authorities, however, have paid attention to Orbita since its early stages and responded to its needs with targeted policies.

InnoGetic is versed in intelligent manufacturing automation and information. The company went to the local taxation department after the COVID-19 outbreak disrupted its operations in 2020. The taxation authority bridged InnoGetic with upstream and downstream enterprises relying on the Smart Industrial Chain Connection and helped it access a social insurance reduction of more than 300,000 yuan ($46,320), according to financial manager Sun Nan.

Energy New Materials has received 30 million yuan ($4.63 million) in tax reductions this year, which allows it to deploy more capital in technology R&D, said Gu Ting, general manager. The company spent more than 90 million yuan ($14 million) in R&D last year, and now has 35 valid patents. Its lithium-ion battery isolation membrane ranks first in the country for technology, production capacity, sales, and net profit.