What is the tax status of international NGOs working in China?
Over the last few years, the tax authorities have applied themselves vigorously, and with growing success, to increasing revenues from import duties, personal and corporate tax. In the light of very low government revenues over the last two decades, this is in itself understandable; but the environment is not propitious for obtaining tax relief. Although the 1999 Public Welfare Donations Law (see here for our translation of the full text) makes a general commitment to providing exemption or reduction of duties for donated goods of money, specific guidelines are lacking and in practice any reduction has to be negotiated on a case-by-case basis with local tax authorities. The bargaining power of the Chinese partner or recipient agency will be a critical element here; but in practice very few international NGOs have been able to obtain, egg, exemption of duties on imported equipment. However, organisations registered as enterprises have generally been able to avoid paying tax on their tot
