The State Council of China proposed seven tax reduction measures in the executive meeting held on April 25, 2018. The annual taxable income threshold of small and micro businesses eligible for halved income tax will be raised from 500,000 to 1 million yuan; the per unit value of newly-purchased research and development (R&D) instruments and equipment eligible for the one-time tax deduction will be raised from 1 million to 5 million yuan; the time limit for the capital loss carryover of high-tech firms and technological small and medium-sized firms will be extended from 5 to 10 years; all enterprises will see an increase in tax deduction for employee training costs from the current 2.5 percent to 8 percent; the pilot personal tax incentive policies for venture capital enterprises and angel investment will be extended to the whole country.

These measures have several obvious characteristics: clearer guidance, reduction of the costs for small and micro enterprises, encouragement of entrepreneurial enthusiasm, stimulation of innovative potential, and a a bigger beneficiary pool as more small and micro enterprises can enjoy the benefits. At the same time, the policies are more stable and continuous. For example,  venture capital and angel investment policies have matured through accumulated experiences in various regions and are conducive to stabilizing market expectations. The tax reduction measures are expected to reduce the tax burden of more than 60 billion yuan for enterprises across the country.