| Abstract | In late 1995, PRC authorities announced a fundamental change to their tax policy regarding foreign investments. The PRC Government decided to abolish, from 1996 onwards, the tax benefits on import custom duties and VAT enjoyed by foreign investors. In effect, this means that plant and equipment imported to China for use by foreign investors will be subject to a 30-40 per cent levy. Since the change could have damaging effects on enterprises with investments in China, the Hong Kong Society of Accountants wrote to the relevant authorities expressing its concern on this matter. Reproduced in this article is a copy of the Society's submission to the PRC Ministry of Foreign Trade and Economic Co-operation (MOFTEC). |
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