On August 30th, the Ministry of Industry and Information Technology, the National Development and Reform Commission, the Ministry of Finance, and the State Administration of Taxation jointly issued the "Notice on the Relevant Requirements for the Development of the List of Integrated Circuit Enterprises to Enjoy Value Added Tax Deduction Policy in 2023" (hereinafter referred to as the "Notice"), clarifying the management methods for the development of the list in 2023 and the conditions for enterprises to enjoy the policy.

The list referred to in this notice refers to the list of integrated circuit design, production, testing, equipment, and material enterprises that enjoy the value-added tax deduction policy mentioned in Finance and Taxation [2023] No. 17. After the list is issued, enterprises included in the list can calculate the amount of additional deductions that can be accrued but have not been accrued during the lead time in the current period.

According to the "Notice", integrated circuit design enterprises that enjoy the policy of adding and deducting must simultaneously meet the conditions including being legally established within China (excluding Hong Kong, Macao, and Taiwan), engaged in integrated circuit design, electronic design automation (EDA) tool development, or intellectual property (IP) core design, and have independent legal personality; In the previous year of applying for preferential policies, the sales (operating) revenue of integrated circuit design (including EDA tools, IP, and design services, the same below) accounted for no less than 60% of the total revenue of the enterprise. Among them, the sales (operating) revenue of independent design accounted for no less than 50% of the total revenue of the enterprise, and the total revenue of the enterprise was no less than (including) 30 million yuan; The enterprise possesses core key technologies and intellectual property rights that belong to the enterprise, and carries out business activities based on them. In the previous year of applying for preferential policies, the total research and development expenses accounted for no less than 6% of the total sales (operating) income (the sum of main business income and other business income, the same below) of the enterprise.

Integrated circuit production enterprises, including those legally established within China (excluding Hong Kong, Macao, and Taiwan), engaged in the manufacturing of logic circuits with integrated circuit line widths less than 130 nanometers (inclusive); Memory manufacturing; Manufacturing of characteristic process integrated circuits with a line width less than 0.25 micrometers (inclusive); Manufacturing of compound integrated circuits with a line width less than 0.5 micrometers (inclusive) and possessing independent legal personality; The enterprise possesses key core technologies and intellectual property rights that belong to the enterprise, and carries out business activities based on them. In the previous year of applying for preferential policies, the total research and development expenses accounted for no less than 2% of the total sales (operating) income (the sum of main business income and other business income, the same below) of the enterprise; In the previous year of applying for preferential policies, the proportion of integrated circuit manufacturing sales (operating) revenue to the total revenue of the enterprise shall not be less than 60%.

Integrated circuit packaging and testing enterprises, including enterprises legally established within China (excluding Hong Kong, Macao, and Taiwan), engaged in integrated circuit packaging and testing, and possessing independent legal personality; The enterprise possesses key core technologies and intellectual property rights that belong to the enterprise, and conducts business activities based on them. In the previous year when preferential policies were applied for, the total research and development expenses accounted for no less than 3% of the total sales (operating) revenue of the enterprise; In the previous year of applying for preferential policies, the proportion of sales (revenue) from integrated circuit packaging and testing to the total revenue of the enterprise shall not be less than 60%, and the total revenue of the enterprise shall not be less than (including) 20 million yuan.

Integrated circuit equipment enterprises, including enterprises legally established within China (excluding Hong Kong, Macao, and Taiwan), engaged in the research and development, manufacturing, and independent legal personality of integrated circuit specialized equipment or key components; The enterprise possesses key core technologies and intellectual property rights that belong to the enterprise, and conducts business activities based on them. In the previous year when preferential policies were applied for, the total research and development expenses for integrated circuit equipment or key components accounted for no less than 5% of the total sales (operating) revenue of the enterprise; In the previous year of applying for preferential policies, the proportion of sales revenue of integrated circuit equipment or key components to the total sales (operating) revenue of the enterprise shall not be less than 30%, and the total sales (operating) revenue of equipment enterprises and key component enterprises shall not be less than (including) 15 million yuan, 10 million yuan, etc.

Integrated circuit material enterprises, including enterprises legally established within China (excluding Hong Kong, Macao, and Taiwan), engaged in the research and development, production, and independent legal personality of integrated circuit specialized materials; In the previous year of applying for preferential policies, the proportion of integrated circuit material sales revenue to the total sales (operating) revenue of the enterprise shall not be less than 30%, and the total sales (operating) revenue of the enterprise shall not be less than (including) 10 million yuan; The enterprise possesses key core technologies and intellectual property rights that belong to the enterprise, and carries out business activities based on them. In the previous year of applying for preferential policies, the proportion of the total research and development expenses for integrated circuit materials to the total sales (operating) revenue of the enterprise should meet the following requirements: for enterprises with a total sales (operating) revenue of less than 1 billion yuan, the proportion should not be less than 5%; For enterprises with a total sales (operating) revenue of 1 billion yuan or more, the proportion shall not be less than 3%.