(Yicai Global) Jan. 19 -- China will continue with some tax and fee cuts covering areas including technology companies and startups that were due to expire at the end of this year.

The State Council, or cabinet, decided to extend 11 tax cuts and fee reductions by one year in a meeting held yesterday, CCTV News reported the same day.

Eligible tech business incubators, university research parks, and market spaces will be exempted from paying value-added tax on incubation services, property tax, and urban land use tax on property and land they or their clients use.

Moreover, venture capital firms and angel investors that have invested in tech startups for two years will continue to have 70 percent of the amount invested deducted from taxable income.

The State Council also extended the tax reduction policy that supports the employment of retired soldiers, public transport, farmers markets, health and epidemic prevention, colleges and universities, pollution prevention and control, and commodity reserves.

China’s economy is facing great pressure this year and tax cuts and fee reductions can stabilize market confidence and ease the burden on market players, Liu Xuhong, a professor at Beijing National Accounting Institute, told Yicai Global.

The government has warned of downward pressure on the economy, which faces shrinking demand, supply shocks, and weakening expectations amid the global pandemic. But it is still expected to grow faster than major developed countries this year.

The extension of tax and fee cuts can help achieve the policy goal of making progress while maintaining stability and carrying out macroeconomic counter-cyclical and cross-cyclical adjustments, Liu said.

China has persisted with big cuts in recent years. According to last month’s National Fiscal Work Conference, new reductions are expected to have reached CNY1 trillion (USD157.6 billion) last year, with this year’s even larger.

On Dec. 29, the State Council extended three cuts to personal income taxes to ease the financial burden on low- and middle-income groups, expected to save them CNY110 billion (USD17.3 billion) in 2022.

Editors: Dou Shicong, Futura Costaglione