China will extend tax breaks on Wednesday to encourage banks and insurers to support agriculture.
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"The continued preferential policy is critical to food security, increasing farmers' incomes and modernizing the sector," said a statement released after a cabinet meeting chaired by Chinese Premier Li Keqiang.
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Bank's interest revenues from small loans to farmers will be exempt from sales tax and corporate income tax shall be payable only on 90 percent of such revenues.
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The meeting decided that the definition of the above-mentioned small loans shall be between 50,000 to 100,000 yuan, instead of less than 50,000 yuan as previously defined.
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Insurers' premium revenues from crop and husbandry insurance shall enjoy a 10 percent discount in calculating payable corporate income tax.
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The three-percent discount on sales tax payable by county-level financial institutions from insurance shall be extended to the end of 2016.