Tax-free technology refers to the customs planning technology that makes taxpayers tax-free, or makes taxpayers engage in tax-free activities, or makes taxable objects tax-free, so as to exempt from tax burden under legal and reasonable circumstances. Tax-free persons include natural persons, tax-free companies, tax-free institutions, etc.
Generally speaking, taxation is inevitable, and everyone has to pay taxes, but taxpayers can become taxpayers who are exempt from taxation (tax exemption) – tax-free persons. For example, under CEPA, goods under specific items originating from Hong Kong and Macao are tax-free, so importers of the above goods enjoy tax-free treatment accordingly. Customs planning can save taxes by legally and reasonably using tax-free regulations.
Although tax exemptions are essentially equivalent to fiscal subsidies, countries generally have two types of tax exemptions for different purposes: one is tax exemptions that are tax-friendly, which are only a compensation for financial benefits for taxpayers; the other is tax exemptions that are tax incentives, which are financial benefits for taxpayers. Considerable tax exemption is often obtained in extraordinary circumstances or under extraordinary conditions, and is generally only used to make up for losses. Therefore, customs planning cannot use it to achieve the purpose of tax saving. Only by obtaining state incentive tax exemption can the purpose of tax saving be achieved.