U.S. Experts' Thoughts on the High and New Technology Program of China

Posted: 16 Jul 2014

See all articles by Peter Cowhey

Peter Cowhey

University of California, San Diego (UCSD) - Graduate School of International Relations and Pacific Studies (IRPS)

Eric Chun

Ernst & Young

Jimmy Goodrich

Information Technology and Innovation Foundation

Date Written: June 24, 2014

Abstract

This paper was a report to the 2014 Innovation Dialogue of the Strategic and Economic Dialogue between the U.S. and Chinese governments. It reviews China's High and New Technology enterprise program to stimulate innovation by firms in China. This program is a back loaded tax expenditure program that substantially reduces tax rates for qualifying firms. The authors argue that the program may not achieve the innovation goals of the Chinese government efficiently or effectively. The authors also highlight a number of problems with the program from the viewpoint of multinational firms operating in China that substantially reduces their participation in the program.

Keywords: R&D incentives, Chinese economic policy, United States, tax programs, multinational corporations

JEL Classification: F13, O31

Suggested Citation

Cowhey, Peter F. and Chun, Eric and Goodrich, Jimmy, U.S. Experts' Thoughts on the High and New Technology Program of China (June 24, 2014). Available at SSRN: https://ssrn.com/abstract=2466084

Peter F. Cowhey (Contact Author)

University of California, San Diego (UCSD) - Graduate School of International Relations and Pacific Studies (IRPS) ( email )

9500 Gilman Drive
La Jolla, CA 92093-0519
United States

Eric Chun

Ernst & Young ( email )

710 Bausch and Lomb Pl
Rochester, NY 14604
United States

Jimmy Goodrich

Information Technology and Innovation Foundation ( email )

1101 K Street N.W.
Suite 610
Washington, DC 20005
United States

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