SMEs can also look forward to help from the tax department in the new year. According to the Ministry of Finance and the State Administration of Taxation, if taxable revenue totals 30 thousand yuan or less, only half the amount will be taxed. While the new tax rate will also be reduced to 20 percent.

The policy will take effect as of next year, and will remain in force through the end of 2010. The plan will slash tax for small businesses by up to 20 million yuan.

Market insiders say the move aims to ease funding problems for small and medium sized enterprises as they continue to struggle to steer their way through an economic slowdown.