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China announces support for SMEs in government purchasing

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BEIJING, Dec. 31 (Xinhua) -- The country's Ministry of Finance (MOF) announced Saturday that the nation's government departments will allocate at least 30 percent of their purchasing quota to small and medium-sized enterprises (SMEs) from the start of 2012.

Meanwhile, 60 percent of the allocated quota will be reserved for small and micro-sized businesses, according to a new guideline jointly issued by the MOF and the Ministry of Industry and Information Technology, a statement on the MOF website said.

The guideline urges relevant units to step up making plans to buy from SMEs in 2012. It also forbids any institution or any individual from impeding or restricting SMEs' access to the government purchasing market, the statement said.

Furthermore, in regards to projects that are not especially oriented to SMEs, the government purchaser or purchasing agency should first implement a 6-10 percent cut in product prices as reported by SMEs, and use the reduced pricing for bidding in order to give them advantages.

The latest policy by the government came after the State Council, or China's Cabinet, in October pledged stronger fiscal support for small and micro-sized businesses, which includes raising the tax threshold for levying corporate, value-added taxes and business taxes.

The MOF also announced last month that the country will scrap the collection of up to 22 items of administrative fees from small and micro-sized companies during the Jan. 1, 2012 - Dec. 31, 2014 period. Such fees include charges for companies' registrations and tax invoice purchases.

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