Export processing zones are supervised by customs and provide a less bureaucratic method of carrying out export processing activities. This is because goods may be brought into these zones without formal declarations having to be made or the need for payments of duties on goods that are being re-exported after processing.

Latest news update: China Issues Catalogue of Products under the Restricted Category in Processing Trade

Relevant Legislation	Interim measures of the Customs of the PRC on Supervision and Control of Export Processing Areas
Corporate income tax	15%
Tax Exemption and Reduction	2 years of exemption and 3 years of reduction by half (at 7.5%) Another 3 years of reduction by half for enterprises 'adopting advanced technology' Preferential tax rate at 10% for the year in which export value exceeds 70%
VAT	Free for in-zone transactions
Local Income tax	exemption and reduction
Import & Export	Administration by registration record system instead of by approval; no quota and license restrictions
Tax refund	Goods from other parts of China treated as export and refund possible
Processing Trade	No bank grantee bond required
Equipment	Imported manufacturing equipment; constructive and decorative materials and office appliances exempted from duty
Forex	Free to open forex account and retain forex