The Notice of the Ministry of Finance, the State Development Planning Commission, the State Economic and Trade Commission, the Ministry of Foreign Trade and Economic Cooperation, the General Administration of Customs and the State Administration of Taxation on Adjusting Certain Preferential Import Tax and Duty Policies was issued on September 4, 2002 came into force on October 1, 2002.
The Notice provides that commodities imported using the "remaining amount" by technological transformation projects, capital construction projects (including major construction projects) and foreign-invested projects (including projects that use loans from foreign governments or international financial organizations which are eligible for foreign-investment-policy-treatment) approved before April 1, 1996 are all to be treated in accordance with the preferential tax and duty policies stipulated in the Notice of the State Council on Adjusting Tax and Duty Policies for Equipment Imports (Guo Fa  No. 37). The Notice states that this means equipment for use by the projects themselves (other than commodities listed in the Domestic Investment Project Imports Not Entitled to Duty and Tax Exemptions and the List of Foreign-Invested Project Imports Not Entitled to Duty and Tax Exemptions) which are imported using monies from the "project amount" or "total investment" will be exempt from import customs duties and import-stage value added tax.
Also, import customs duties and import-stage value added tax are to be levied in accordance with regulations on all equipment imported by permitted foreign-invested projects that directly export all of their products ("export-only projects") which were approved on or after the date on which the policy adjustments came into force. The tax and duties will be refunded over a period of five years (20% each year) if ongoing verification confirms that the products are indeed exported.
Other points are addressed, such as the treatment of equipment imports by export-only projects approved before the policy adjustments came into force, the method of refunding duties and taxes and applications for individual cases of import duty and tax reductions or exemptions.