China said it lowered taxes on semiconductor manufacturers and provided new support to the crucial industry, while US President Donald Trump weighs tariffs on the sector with rising trade tensions  The new rules cover a wide range of semiconductor companies. They will be exempt from corporation tax for up to five years from 1 January, the Ministry of Finance said Friday in a statement. The tax rates thereafter will then be half of the current 25 percent until the 1
Tax relief on tax cuts announced Wednesday in favor of high-end manufacturers and innovation-driven technology companies backed by Made in China 2025 plan: a blueprint for the Asian nation to boost competitiveness in emerging industries Strengthen information technology to aerospace.
Beijing has long been trying to expand its chip sector. China intends to reduce its dependence on annual semiconductor imports of approximately $ 200 billion as it fears that this undermines national security and hampers the development of a thriving technology sector. The country plans to spend $ 150 billion over 10 years to gain leadership in design and manufacturing, an ambitious plan that US managers and officials could warn to harm American interests.
While officials may be unrealistic about their initial vision of achieving global advantage, the government continues to strive to reduce imports as the world's largest semiconductor consumer. First, an important Chinese government fund is expected to raise as much as 200 billion yuan ($ 32 billion) to invest in in-house chip companies and accelerate its ambition to build a world-class semiconductor industry.
The country has been offering lower taxes for integrated circuit companies since at least 2012 in order to promote the development of the technology. Requirements of companies eligible for the deduction were revised in Friday's statement to include more current technology.
– With support from Miao Han, Yinan Zhao and Jessica Sui