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Officials from the Rudong county tax bureau visit a local manufacturer and help it handle its tax affairs. [Photo/ntfabu.com]

More and more manufacturers in Rudong county – administered by Nantong city in East China's Jiangsu province – have been benefiting from the nation's extra tax deductions allowable on research and development expenses, thanks to guidance from the local tax bureau.

China is continuing to grant an extra tax deduction of 75 percent on corporate R&D costs and has raised this to 100 percent for manufacturers, in order to stimulate business innovation and expand the general upgrading of industry.

This means that for every 1 million yuan ($153,300) spent on R&D, a manufacturer will see 2 million yuan deducted from its taxable income.

The Rudong county taxation bureau has reportedly listened to the needs of local business and provided it with tailored services, including assistance in policy interpretations and help with applications for R&D expense deductions and record filings.

Miao Dongqing, general manager of Zhongtian Broadband Technology, said his company was among businesses to have recently received help from the tax bureau. He said that last year the company developed six new products – including 5G technology series products and high-density aviation plugs – that generated additional revenue of more than 100 million yuan.

This year the company will invest 40 million yuan to support R&D and commercialize technological advances, with plans on the drawing boards to launch 10 new products.

According to the calculations by the bureau, 182 manufacturers in Rudong are currently entitled to the R&D tax breaks.

It has estimated that the extra tax deduction on R&D expenses will total 230 million yuan and that overall corporate income tax will be reduced by 40 million yuan.