Starting April 1, enterprises registered in the Qingdao Area of the China (Shandong) Pilot Free Trade Zone, Qingdao FTZ, is been able to engage in offshore trade without paying stamp duty. [Photo provided to chinadaily.com.cn]

Starting April 1, enterprises registered in the Qingdao Area of the China (Shandong) Pilot Free Trade Zone, Qingdao FTZ, has been able to engage in offshore trade without paying stamp duty. The zone has become the only free trade experimental zone in northern China to be approved for the policy, which will be in effect until Dec 31, 2027.

Offshore trade refers to a trade method in which goods do not enter the country; domestic traders directly transport goods from the exporting country to the importing country by buying and selling foreign goods rights. Stamp duty is the main tax involved in this business model.

With the implementation of the stamp duty exemption policy for offshore trade, enterprises registered in the Qingdao FTZ conducting offshore trading will be exempt from stamp duty on sales contracts for offshore transactions. This directly reduces the transaction costs for enterprises, enhances their profit-making capabilities, and boosts their market competitiveness.

"This policy is a real boon for our company," said a person in charge engaged in offshore trade within the zone. "In the past, stamp duty was a significant expense when conducting offshore trading. With the exemption of stamp duty now, we can allocate more funds to business expansion and innovation, further enhancing the development potential of the enterprise."

In recent years, the Qingdao FTZ has successively introduced multiple policies to support the development of offshore trade and established a new offshore international trade comprehensive service platform. This has attracted numerous leading enterprises with scaled and globalized resource allocation to conduct offshore trade operations in the zone, promoting the rapid aggregation of offshore trade business.

According to statistics, from 2023 to 2024, the international balance of payments for offshore transactions in the zone reached approximately $21.5 billion, accounting for over 90 percent in Qingdao and about 85 percent of the total in the province.