China: Update on individual income tax rebate in Hengqin Island for Hong Kong and Macao residents

Global Watch ()

In July 2011, a series of innovative tax, customs, finance, and land policies offered to Hengqin Island (Hengqin) within the Zhuhai Special Economic Zone (which is a coastal city in south-east China) were approved by the State Council. As part of these preferential policies, it was announced that Hong Kong/Macao residents working in Hengqin could receive the China Individual Income Tax (IIT) rebate from the Guangdong provincial government so that their effective China IIT burden would be close to what they would pay if they had instead been working in Hong Kong/Macao.

In December 2012, the Provincial Finance Bureau of Guangdong issued the Provisional Administrative Measures on the Individual Income Tax Rebate for Hong Kong and Macao Residents Working in Hengqin New Area of Zhuhai (Hengqin IIT Rebate Measures) which provides guidelines to implement the IIT rebate program to attract talent to work in Hengqin.

This alert highlights the implementation details of the IIT rebate program in Hengqin.