Guangzhou offers tax waivers to cleantech firms

The government of Guangzhou, China, has unveiled an aggressive new tax strategy aimed at attracting small and medium companies that work in the environmental sector.

Guangzhou announced that the companies engaged in energy savings, environmental protection, waste treatment, or other cleantech projects are eligible.

The perks include a waiver of 100 percent of the corporate income tax for the first three years, and 50 percent waived for the following three years.

The tax policy would go into effect once a company earns its first revenues.

Guangzhou is the capital of Guangdong Province in the southern part of China, about 75 miles northwest of Hong Kong. Guangzhou is the economic center of the Pearl River Delta, which is considered one of China's top commercial and manufacturing regions.

For that reason, it has attracted a number of cleantech firms already. In September, Fairfield, Conn.-based General Electric (NYSE:GE) announced plans to establish one of its five new offices in Guangzhou as part of its concentrated effort to grow its presence and customer base throughout China (see GE ups presence in China).

The city has mandated that all buses and taxis will be fueled by liquefied petroleum gas by 2010.