The “Catalogue of Industries Encouraged in the Western Region (2020 Edition)” has been released.

Release Date:

2021-01-29

On the 26th, the National Development and Reform Commission released the “Catalogue of Industries Encouraged in the Western Region (2020 Edition).” Enterprises in the western region that qualify for incentives will be subject to an enterprise income tax rate of 15%.

The newly revised catalog shall take effect as of March 1, 2021. According to a responsible official from the National Development and Reform Commission, this revision places particular emphasis on addressing key priorities, making up for shortcomings, and strengthening weak areas, thereby promoting industrial restructuring, optimizing industrial spatial layout, and fostering the growth of industries with distinctive advantages in the western region, while actively supporting the new development paradigm characterized by the domestic circulation as the mainstay and the mutual promotion of domestic and international circulations.

Reducing the corporate income tax rate to 15% for enterprises in the western region that qualify under the encouraged‑industry category is one of the key policies of the Western Development Strategy. The Catalogue of Encouraged Industries in the Western Region defines the scope of industries eligible for the preferential corporate income tax treatment under this strategy and serves as a crucial basis for determining whether an enterprise can benefit from these incentives. The current catalogue was promulgated and came into effect in 2014.

The scope of application for the policy on encouraged industries in the western region encompasses 12 western provinces, autonomous regions, and municipalities—namely Chongqing, Sichuan, Guizhou, Yunnan, Tibet, Shaanxi, Gansu, Qinghai, Ningxia, Xinjiang (including the Xinjiang Production and Construction Corps), Inner Mongolia, and Guangxi—covering more than 70 percent of China’s total land area. Meanwhile, Yanbian in Jilin, Enshi in Hubei, Xiangxi in Hunan, and Ganzhou in Jiangxi are treated in accordance with the policies applicable to the western region.

Table of Contents: In 2020, the document maintained its original structural framework and largely stable core content. The first section continues to reference the encouraged‑industry categories from the “Guidance Catalogue for Industrial Structure Adjustment” and the “Catalogue of Industries Encouraged for Foreign Investment,” specifying that any revisions to these catalogs will be implemented in accordance with the newly revised versions. The second section remains organized by the 12 provinces, autonomous regions, and municipalities of the western region, with appropriate additions, deletions, and modifications to the existing entries for each jurisdiction, thereby reflecting both national and regional industrial development priorities while accounting for the diverse characteristics of the western areas.

This revision focuses on four key areas: first, further bolstering China’s scientific and technological self-reliance; second, further facilitating the orderly relocation of industries to the western region; third, further encouraging the western region to leverage its distinctive strengths; and fourth, further supporting the western region in addressing its shortcomings and strengthening its weak points.

Source: People’s Daily (Agriculture Edition)

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