On 25 June 2019, the Shanghai Municipal Science and Technology Commission, together with other four municipal administrations, published the Management Measures for the Recognition of Technology Advanced Service Enterprise (TASE) Status in Shanghai (Hu Ke Gui  No. 4). The Measures, based on the Notice on Expanding Nation-wide Corporate Income Tax Policies for Technology Advanced Service Enterprises (Cai Shui  No. 79), regulate the processes through which applications for the Technology Advanced Service Enterprise (TASE) status are submitted, processed, and evaluated.
TASE refers to enterprises which, independently or through subcontractors, have signed outsourcing services agreements with overseas entity, for the provision of Information Technology Outsourcing (ITO), Business Process Outsourcing (BPO), or Knowledge Process Outsourcing (KPO) services, as prescribed in a detailed list of qualifying services attached to the Measures. Being recognised with TASE status grants:
- Corporate Income Tax (CIT) rate deduction to 15%, from the statutory 25% rate;
- Expenditure for the training and education of personnel, are deductible from their individual taxable income for a maximum of 8% of the personnel’s salary amount (compared to the 2.5% statutory rate); the part exceeding 8% can be deducted in the next fiscal year.
In order to be eligible for TASE status in Shanghai, candidate enterprises must:
- Enterprise with legal personality in Shanghai
- Be operating in one or more technology services included in an Annex appended to the Measures. Income in these services should exceed 50% of the enterprise’s income, while the income from overseas outsourcing services should exceed 35% of the enterprise’s annual income in that yea
- Over 50% of the staff should possess at least an associate college degree.
Applications to TASE status are managed at the municipal-level. Applications are first submitted online and then to district-level S&T bureaus where the applicant is located; after a first screening, eligible applications are then forwarded to the responsible office at the municipal level; applications are finally evaluated through peer review: the lists of approved TASEs will be disclosed online on the website of the Shanghai S&T Commission.