Depreciation Policy Promotes Technological Innovation in Instrument Manufacturing

Chinese companies facing the pressure of transformation and upgrading have ushered in favorable policies. The recent executive meeting of the State Council pointed out that the policy of accelerating the depreciation of fixed assets should be improved to promote the technological transformation of enterprises and support the innovation and innovation of SMEs. This policy will not only drive companies to upgrade their technology and equipment, set off an upsurge in R&D and innovation, but will also play a role in stabilizing economic growth by encouraging investment in fixed assets.

Premier Li Keqiang of the State Council presided over the executive meeting of the State Council on September 24 to deploy and improve the accelerated depreciation policy for fixed assets, promote technological transformation of enterprises, and support entrepreneurship and innovation for SMEs, and decided to further open up the domestic express delivery market and promote fair and orderly competition between domestic and foreign investors.

The meeting pointed out that in keeping with the trend of the new technological revolution and promoting China's economy to move toward the high-end level, we must make greater efforts to promote technological transformation of enterprises. We must use current, more long-term reforms to improve the current accelerated depreciation of fixed assets, reduce tax burdens, accelerate corporate equipment renewal, technological R&D and innovation, expand investment in manufacturing, and promote public entrepreneurship. This is a breakthrough for traditional industries. "Industrialization and transformation of butterflies" is of great significance in enhancing economic development and vitality and realizing the upgrading of quality and efficiency as well as the sustained and steady growth.

The meeting determined that, first, all equipment and equipment purchased for R&D after January 1, 2014, with a unit value of not more than 1 million yuan, shall be included in the current period; If the amount is 10,000 yuan, the depreciation period can be shortened by 60%, or depreciation can be accelerated by double declining balance. Second, fixed assets with a unit value of not more than RMB 5,000 held by all industries and enterprises are allowed to be included in current expenses and expenses before tax. The third is the manufacture of bio-pharmaceuticals, special equipment manufacturing, railways, ships, aerospace and other transportation equipment manufacturing, computer, communications and other electronic equipment manufacturing, instrument and meter manufacturing, information transmission, software and information technology services For fixed assets newly acquired after January 1, 2014, etc., industry enterprises are allowed to shorten the depreciation period by 60% of the specified number of years, or adopt accelerated depreciation methods such as double-declining balances to promote the expansion of imports of high-tech products. According to the implementation, the scope of the industry to which the policy applies should be expanded in a timely manner. The meeting called for accelerating the implementation of the above-mentioned policies, striving to arm “Made in China” with advanced technology and equipment, and launch products with higher added value and stronger market competitiveness.

“This is a three-step measure with high gold content, which will have a substantial burden on the company and help companies take the initiative to upgrade their technology and equipment,” said Zhu Jianfang, a professor of economics at the Chinese Academy of Social Sciences. He believes that the three requirements constitute the background for the introduction of the above-mentioned policies. First, the current Chinese economy still has downward pressure, domestic demand is relatively weak, and investment demand is weak; second, economic restructuring requires upgrading of industrial equipment; and third, enterprises must strengthen international The competitiveness also needs to improve the technical level.

Zhu Jianfang believes that this policy tends to structurally support the equipment manufacturing industry, especially high-tech products, and will upgrade the technology and equipment level of the industry through faster equipment upgrades, promote economic transformation, improve the quality of economic growth, and control the environment. Pollution will help.

Jia Kang, director of the Institute of Fiscal Science of the Ministry of Finance, believes that the transformation and upgrading of enterprises will inevitably have investment in equipment. The measures of the executive meeting are to encourage enterprises to accelerate the upgrading of equipment and technology. Accelerated depreciation is essentially a tax base for the country to reduce specific corporate income taxes. Accelerating depreciation for higher equipment costs offsets the taxable income of the company. It is actually a component of the state's structural tax reduction.

It is understood that, under certain circumstances of income, the accelerated depreciation method can defer the tax period of corporate income tax. With the rise of "Machine Generation" in recent years, this policy undoubtedly brings good news to small and medium-sized enterprises that have achieved transformation and upgrading by purchasing equipment such as industrial robots.