In an effort to support oil and gas drilling, the Chinese government has issued tax exemption incentives for drilling programs in China, according to a statement released Thursday on the website of the Ministry of Finance.
The statement said that from Jan 1, 2011 to Dec 31, 2015, oil and gas drilling projects on specially appointed land and sea areas will be exempt from import taxes on equipment, instruments, accessories and special purpose tools that domestic companies are unable to manufacture and are directly used in exploration and exploitation.
The exemptions are valid within quotas for free imports.
Tax-exempt drilling programs include projects on deserts and barren beaches in Chinese territory, land blocks jointly exploited by Chinese and foreign companies under the permission of the Chinese government, inland seas, territorial waters, continental shelves, and other maritime resources under China's jurisdiction.
Programs on maritime territory and land blocks jointly exploited by Chinese and foreign companies will also be exempt from import value-added tax, according to the statement.
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