Companies can deduct income tax for purchasing safety equipment
Thread Content
The Implementing Regulations of the Enterprise Income Tax Law of the People’s Republic of China were adopted at the 197th executive meeting of the State Council on November 28, 2007, and came into effect on January 1, 2008. The regulations stipulate that \"when an enterprise purchases and actually uses special equipment for environmental protection, energy conservation and water saving, or safe production, as listed in the ‘Catalogue of Special Equipment for Enterprise Income Tax Incentives related to Environmental Protection’, the ‘Catalogue of Special Equipment for Enterprise Income Tax Incentives related to Energy Conservation and Water Saving’, and the ‘Catalogue of Special Equipment for Enterprise Income Tax Incentives related to Safe Production’, 10% of the investment cost in such special equipment may be deducted from the enterprise’s taxable amount for that year.\" ； If the amount is not sufficient for a deduction in that year, it can be carried forward for deduction in the next 5 tax years. ”
Indirectly reflects the level of investment in safety
Notice from the Ministry of Finance and the State Administration of Work Safety on Issuing the Interim Measures for the Financial Management of Safety Production Expenses in Enterprises in High-Risk Sectors, Document No. Caiqi [2006] 478: Interim Measures for the Management of Safety Production Risk Deposits in Enterprises.doc
Tax deductions are more practical in terms of implementation. The previous Interim Measures for the Financial Management of Safety Production Expenses in High-Risk Industries were merely theoretical – although it was stated that safety expenses should be used for specific purposes, no concrete measures were provided, which resulted in low enthusiasm among enterprises