May 7, 2010 (China Knowledge) - Chinese airlines will be exempted from a business tax imposed on international routes, the Ministry of Finance and the State Administration of Taxation said on Wednesday, the Shanghai Daily reported.
As the exemption has been made retroactively from January 1, 2010, domestic airlines do not need to pay the 3% tax on international routes, and the tax that has been paid will be refunded.
The policy also applies to firms or individuals that offering international delivery services, such as shipping firms, the MOF said on its website.
The new policy aims to help domestic airlines expand their presence in the global market amid recovering demands for international air transport, the English-language newspaper said.
Chinese airlines were confronted with shrinking demand for air transport in 2008 when the global financial crisis broke out. However, the country's major airlines returned to profitability last year and the first quarter of this year as the economy recovers.