China Regulatory Brief: Temporary Residence Permit Abolished, Adjusted Minimum Wage Levels

February 23, 2015 Posted by China Briefing Reading Time: 4 minutes

Beijing Adjusts its Minimum Wage Levels for 2015

On February 15, the Beijing Human Resources and Social Security Department released its monthly and hourly minimum wage levels for 2015, which took effect on April 1, 2015. Accordingly, the monthly minimum wage in Beijing has been adjusted to RMB 1,720 from RMB 1,560 (10.3 percent growth), while the hourly minimum wage has been adjusted to RMB 18.7. Meanwhile, the hourly minimum wage for part-time workers during national holidays has been adjusted from RMB 40.8 to RMB 45.

Hong Kong and Macau Investors to Enjoy National Treatment in Guangdong

On February 16, the China National Tourism Administration announced that Hong Kong and Macau investors who provide hotel and restaurant services, and tour guide services will be granted national treatment in Guangdong province, starting March 1, 2015. The move is based on the trade liberalization deal signed by between mainland and Hong Kong officials in December last year, under the framework of the mainland-Hong Kong Closer Economic Partnership Arrangement (CEPA). The trade liberalization deal removes restrictions for 58 service sectors including real estate, environmental protection and computer installation services, aiming to facilitate the development of Hong Kong and Macau-funded enterprises.

China to Abolish Temporary Residence Permit System

China’s State Council recently approved a public security reform plan to abolish its controversial temporary residence permit and further reform the household registration system. The plan also clarified that permanent residence permits would be adopted to replace the much-criticized temporary residence permit. The temporary residence permit, a type of temporary ID for migrant workers, was first implemented in Shenzhen in 1984 and spread quickly across other big cities. In China, it is common that only local residents or migrants with more than five years of paying local taxes in a city are allowed to buy apartments and cars in the city. Only migrants with permanent residence permits may enjoy most of the same privileges as local residents, such as social security and other public services.

Hainan Expands Duty-free Goods Categories

On February 18, the Ministry of Finance (MOF) announced that China would expand the number of eligible items that can be bought duty-free from Hainan from March 20, 2015. According to the Announcement, infant formula, coffee, air purifiers and other 17 items will be newly allowed to be bought duty-free from Hainan. Further, quantitative restrictions will be removed for purchases of the top 10 most popular items including perfumes, cosmetics, watches, apparel, and small leather goods. In another move to boost its domestic tourism industry, China has released a document to expand its tourism value-added tax (VAT) rebate scheme nationwide in January.

About Us

Asia Briefing Ltd. is a subsidiary of Dezan Shira & Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information, please email china@dezshira.com or visit www.dezshira.com.

Stay up to date with the latest business and investment trends in Asia by subscribing to our complimentary update service featuring news, commentary and regulatory insight.

‍

Adapting Your China WFOE to Service China’s Consumers
In this issue of China Briefing Magazine, we look at the challenges posed to manufacturers amidst China’s rising labor costs and stricter environmental regulations. Manufacturing WFOEs in China should adapt by expanding their business scope to include distribution and determine suitable supply chain solutions. In this regard, we will take a look at the opportunities in China’s domestic consumer market and forecast the sectors that are set to boom in the coming years.

Human Resources and Payroll in China (Third Edition)
A firm understanding of China’s laws and regulations related to human resources and payroll management is essential for foreign investors who want to establish or are already running foreign-invested entities in China. This guide aims to satisfy that information demand, while also serving as a valuable tool for local managers and HR professionals who may need to explain complex points of China’s labor policies in English.

Employing Foreign Nationals in China
In this issue of China Briefing, we have set out to produce a guide to employing foreign nationals in China, from the initial step of applying for work visas, to more advanced subjects such as determining IIT liability and optimizing employee income packages for tax efficiency. Lastly, recognizing that few foreigners immigrate to China on a permanent basis, we provide an overview of methods for remitting RMB abroad.