The New York Times reported on December 28, 2017 that China's Finance Ministry had decided that from January 1, 2018 it would temporarily exempt foreign companies from paying tax on their earnings in a bid to keep American businesses from taking their profits out of China following Washington’s overhaul of the United States tax code. It, however, has said that to be eligible, foreign companies must invest those earnings in sectors encouraged by China’s government — including railways, mining, technology and agriculture.  — according to a statement from the Finance Ministry. China’s Vice  Minister of Finance, Zhu Guangyao, was earlier reported by Xinhua as having pledged to “take proactive measures” in response to the overhaul as the the impact of the changes overseas “cannot be overlooked.”

(Comment: Despite its appeal as a manufacturing hub, one where companies from around the world have set up operations to tap into a highly skilled work force and strong infrastructure, China charges high taxes. On top of a standard corporate rate of 25 percent, companies are required to make social security contributions and other payments that push their tax burden higher than it is in many other countries. China has also in recent years been tightening restrictions on the outflow of foreign currency and repatriation of funds by companies.)