China Economic Review: 200 billion tax delays help small, medium and micro enterprises survive adversity

  Core View: Liang Yu, a commentator on China Economic Net, believes that tax delays are equivalent to an extra short-term interest-free loan for companies, which can ease the pressure on cash flow and solve urgent needs.

In addition to the active actions of government departments, small, medium and micro enterprises must also work hard to improve their internal skills to enhance their ability to resist risks.

With all efforts, we believe that small, medium and micro enterprises in the manufacturing industry can overcome difficulties.

  Recently, the executive meeting of the State Council has deployed the implementation of phased tax deferral measures for small, medium and micro enterprises in the manufacturing industry to further increase the efforts to help enterprises to relieve their difficulties.

The tax deferment will be implemented on November 1 this year and will end in January next year. It is estimated that the tax deferment will be around 200 billion yuan for small, medium and micro enterprises in the manufacturing industry.

  Generally speaking, due to factors such as billing period and payment, the three months before the New Year are when the capital cost of enterprises is relatively high.

Although tax deferment is not tax exemption, the delay in tax payment is equivalent to an extra short-term interest-free loan for the company, which can ease the pressure on cash flow and solve urgent needs.

  In addition, compared with the tax and fee reduction policies at the beginning of the year, this meeting expanded the scope of tax incentives.

At the beginning of the year, the tax and fee reduction policies mainly favored small and micro enterprises and advanced manufacturing. This meeting included medium-sized enterprises and did not require enterprises to have R&D expenses or meet the conditions of advanced manufacturing, which expanded the scope of benefit to enterprises.

The deferred taxes cover five categories: domestic value-added tax, corporate income tax, domestic consumption tax, personal income tax, and urban maintenance and construction tax. More than 90% of the tax burden of enterprises comes from these taxes.

  In fact, since October, this is the third time that the State Council executive meeting has deployed relevant policies for small, medium and micro enterprises.

The release of policy dividends can be said to be just the right time.

In recent times, commodity prices have been operating at a high level, and the production costs of enterprises have risen sharply, which has a certain impact on manufacturing enterprises.

Due to their limited market share, small, medium and micro enterprises have weak bargaining power in purchasing raw materials and selling prices of terminal products, causing them to be under pressure on both sides.

The cost of production and operation continues to rise, and profit margins continue to shrink, so that some companies lose money in production and call it "dare to take orders."

  According to data from the National Bureau of Statistics, in September, the national factory prices for industrial producers rose by 10.7% year-on-year, of which the prices of means of production rose by 14.2%.

According to data released by the China Association of Small and Medium Enterprises on October 9, the SME Development Index in the third quarter was 86.7, the lowest point since the third quarter of last year.

Business activities are economic activities. Under this circumstance, it is very necessary for the government to "hand in hand" to help small, medium and micro enterprises restore their vitality.

  In fact, in addition to reducing taxes and fees and allowing small, medium and micro enterprises to go into battle, the executive meeting of the State Council has repeatedly studied the issue of excessive commodity prices.

Relevant ministries and commissions have also taken the initiative to ensure the supply of bulk commodities.

For example, the National Development and Reform Commission and the National Bureau of Grain and Material Reserves have put a total of 420,000 tons of national reserves of copper, aluminum and zinc in three batches on July 5, July 29, and August 27.

The reserve placement demonstrates the country's determination to maintain supply and stabilize prices, guide price expectations, and ease the pressure on raw material costs for certain industries and enterprises.

  In the face of unfavorable factors such as rising raw material prices and the impact of the epidemic, in addition to the active actions of government departments, small, medium and micro enterprises must also work hard to improve their ability to resist risks.

At present, many small, medium and micro enterprises are developing towards "specialization, special innovation", through innovation to hedge the pressure brought by the price increase of raw materials, expand development space, and create new competitive advantages.

According to the latest data released by the Ministry of Industry and Information Technology, the number of "little giant" companies nationwide has reached 4,762.

  The vitality of market players means that China's economy has momentum.

At present, the global epidemic trend and economic development trend are becoming more complicated, new situations and old problems are intertwined, and the risks and challenges remain unabated.

Unleash the policy dividends and actively seek changes. With the efforts of all parties, we believe that small, medium and micro enterprises in the manufacturing industry can overcome difficulties and promote the stability and long-term development of China's economy.

(Liang Yu, commentator of China Economic Net)