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China to introduce favorable taxation policy for rural financing

2010-02-26 18:02 BJT

 

The Chinese Banking regulator says it will introduce a favorable taxation policy to increase incentives for rural financing. Banks will get support in lending to agriculture, rural residents, and countryside projects.

Zang Jingfan, Official of CBRC, said, "Banks lending small loans of less than 50 thousand yuan to rural areas will be exempted from business tax, and receive a 10 percent discount in income tax. Financial institutions established at a township level will pay three percent in business tax."

The business tax for banks is commonly five percent. The favorable taxation policy is expected to boost rural financing, in order to support the development of rural areas.

China plans to establish 990 new countryside financial institutions, to further strengthen the rural finance market.

China's financial institutions had issued 9.14 trillion yuan of outstanding loans to rural areas as of the end of 2009. That is 34.8% percent higher than the beginning of the year.

Editor: Zhang Pengfei | Source: CCTV.com