Overview of Suzhou
Located in the south of Jiangsu province, Suzhou is a world-renowned garden city. All the buildings, mountains, rivers, sculptures, paintings and calligraphy works of Suzhou are characterized by its deep-rooted history and culture. Following the wave of economic globalization, Suzhou now has topped the economic development list in China. As a major economic city in the Yangtze River Delta, Suzhou is also a leader in service outsourcing industry in the south of Jiangsu province.
The Suzhou Industrial Park, an important cooperation project between China and Singapore, is one of the first parks honored by the Ministry of Commerce as Service Outsourcing Model Park. In the past 14 years since inauguration of the Park, it has become one of the most important manufacturing bases in China, with most of its companies doing ODM or OEM businesses. The enriched experience and favorable conditions will surely help the companies to extend manufacturing outsourcing to service outsourcing.
Service outsourcing industry in Suzhou
Goal of service outsourcing development in Suzhou
By 2010, Suzhou will have attracted or built over 10 international offshore service outsourcing general contractors and outsourcers, developed over 100 leading companies of service outsourcing, with over RMB 10 billion of service outsourcing turnover, and over US$ 1 billion of offshore service outsourcing turnover, and turned the software park into an internationally prestigious service outsourcing base.
The specific goals of the Suzhou Industrial Park are as follows:
1. Twenty of the world top 100 service outsourcing companies will be attracted to move to the industrial park, with 1 or 2 of the world top 10 ITO /BPO companies.
2. Fifty of the world top 500 companies will be attracted to outsource their business to the industrial park.
3. The total employment of the service outsourcing industry will reach 60,000.
4. Suzhou will be able to train 5,000 labor force for service outsourcing every year.
5. Annual revenues from service outsourcing will exceed RMB 15 billion, with US$ 1 billion from offshore outsourcing.
Preferential policies of Suzhou Government to encourage service outsourcing
To support service outsourcing development, Suzhou Government made a number of policies, such as Tailored Taxation Polices for Technology-based Service Companies in the Suzhou Industrial Parks, Polices on Promoting Development of Technology-based Service Companies in the Suzhou Industrial Parks, Policies on Promoting Development of Service Outsourcing of the Suzhou Industrial Parks, and Policies on Administration of Certification of Technology-based ServiceCompanies in the Suzhou Industrial Parks etc., under the support of the central authorities of finance, commerce, taxation and technology.
Major taxation preferential polices are listed as follows:
From July 1, 2006, 15% of corporate income tax will be cut for domestic and foreign technology-based service companies that have been certified as new and high technology-based companies.
From July 1, 2006, the actual legal payroll of the technology-based service companies that have been certified as new and high technology-based companies will be deducted before corporate income tax payment.
From January 1, 2006, employee education funds, within 2.5% of the total payroll of company in the same year, will be deducted from corporate income tax payment for technology-based service companies.
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