The Ministry of Finance and State Administration of Taxation jointly issued the Circular on Taxation Policies for Supporting Animation and Cartoon Industry, providing breaks in multiple taxes such as value added tax, income tax, business tax, import tariff and import value added tax to domestic animation and cartoon businesses and confirming the intent of elevating innovation capacity of the domestic industry. 

In terms of value added tax, as of December 31, 2010, for the software developed independently by the taxpayer, China will refund all taxes above the 3% of the 17% value added tax levied.  Such software will also be exempted from export value added tax.  In terms of income tax, those animation products verified may claim the preferential rates for software industry.

(China IP News)