China is renowned for being one of the biggest economic leaders in the world. It is now one of the most technically-driven countries and is open to international trade. With its huge population of 1.4 billion, China’s economy is growing rapidly. It is one of the most profitable international markets to conduct business in.
China is also well-known for its low-cost, high-labour manufacturing centers. It’s manufacturing economy is 50% larger than the manufacturing company in the United States of America.
Here are some reasons why you should incorporate a business in China:
Access to the China Market
Selling in the Chinese Market is advantageous and can help a business grow rapidly. However, the process one has to go through in order to sell in the market is extremely complicated with all the paperwork required. Also, the best way for a business to be included in the local market is if it were to have its own local company.
When a business incorporates its own China company, it will be able to take advantage of local services such as accounting and banking. Using local accounting services can make your company seem more trustworthy to the local audience. Opening a China bank account is highly encouraged as the eCommerce industry is on the rise in China.
The abundance of skilled talents
Young Chinese professionals are competent and highly skilled in what they do. With China incorporating English into their education system, many of these individuals are bilingual and are able to speak both Chinese and English. Businesses will have a chance to hire one of these talented individuals when they incorporate a company in China.
Whether your business is in the trading sector, financial sector or eCommerce sector, you will require workers. Therefore, it is ideal to hire some of the local talents.
The business regulations in China are changing rapidly and some sectors are not regulated. This means that new opportunities are available and chances for growth are common. As compared to any other developed country in the world, it is much easier to run a business in China that is in the internet finance or digital health sectors. Regulation being minimal gives entrepreneurs the opportunity to be creative with ideas and experiment freely with them.
Government policies in China have always been very favourable. The Chinese government has been supporting both local and international companies very proactively. These measures support them entreprenically and they include business subsidies, aiding citizens in the creation of their business ideas as well as supporting creativity and innovation.
Corporate Income Tax
Qualified enterprises in some industries or regions being encouraged by the Chinese government
10% – 15%
Most other businesses
Qualified small or thin-profit businesses
2.5% – 5% (temporary measures through to 31 December 2022)
Here are the corporate tax rates in China. The basic corporate income tax rate as of now is 25%. However the corporate income tax can be reduced to 15% and even 10% if the business is under government incentives. These are mostly for businesses that are in industries which are beneficial to the national interest. This will be determined by which country the business operates in, the company turnover and the industry area.