CHINA will remain a highly favored investment destination for European companies in the long run, given its latest policy measures to boost market confidence and its efforts to reinforce its position in the global industrial, innovation and capital chains, experts and business executives said Tuesday.

They made the remarks after the European Union Chamber of Commerce in China said the country’s four-year extension of favorable individual income tax policies for foreign nationals is “very positive news.”

China has extended its preferential tax policies for foreign nationals working in the country till the end of 2027, according to the Ministry of Finance.

The extension means that certain expenses such as housing, children’s education and language training will be exempt from taxation, the EU Chamber of Commerce in China said Monday.

The EU chamber expressed the hope that further concrete steps will be taken to implement related measures.

As outlined in the provisions, foreign individuals who meet the eligibility criteria can either opt for the special additional deduction on personal income tax or adhere to the earlier regulations, thereby accessing tax exemption benefits on housing subsidies, language learning fees, children’s education expenses and other subsidies.

Bai Ming, deputy director of international market research at the Beijing-based Chinese Academy of International Trade and Economic Cooperation, said that this move will attract more overseas talents to come to and stay in China.

The move also sends a positive signal to multinational corporations that they can continue to ramp up investment in the massive and lucrative Chinese market, Bai said.

The State Council issued a 24-point guideline in mid-August to attract more global capital. The Central Government’s commitment to enhancing the environment for foreign investment encompasses six key areas, which include ensuring effective utilization of foreign investment, increasing fiscal and tax support, and upgrading the facilitating mechanism for foreign investment.

(China Daily)