The Ministry of Finance and the State Administration of Taxation have now announced the following matters relating to the pre-tax deduction of advertising expenses and business promotion expenses: 1. The portion of advertising expenses and business promotion expenses incurred by cosmetics manufacturing or sales, pharmaceutical manufacturing, and beverage manufacturing enterprises shall not exceed 30% of the current year's sales revenue; the excess portion is allowed to be carried over and deducted in future tax years. 2. For affiliated enterprises that have signed an agreement to share advertising fees and business promotion expenses, advertising expenses and business promotion expenses incurred by one party not exceeding the pre-tax deduction limit ratio of sales revenue for the current year can be deducted by the enterprise, or part or all of them can be deducted by the other party in accordance with the apportionment agreement. When calculating the enterprise's advertising expenses and business promotion expenses before corporate income tax deduction limits, the other party may exclude the company's advertising expenses and business promotion expenses according to the above method. 3. Tobacco advertising expenses and business promotion expenses of tobacco companies shall not be deducted when calculating taxable income. 4. This announcement will be implemented from January 1, 2026 to December 31, 2027. The “Notice of the Ministry of Finance and the State Administration of Taxation on Matters Relating to Pre-tax Deduction of Advertising Expenses and Business Promotion Expenses” was abolished on January 1, 2026.

The Ministry of Finance and the State Administration of Taxation have now announced the following matters relating to the pre-tax deduction of advertising expenses and business promotion expenses: 1. The portion of advertising expenses and business promotion expenses incurred by cosmetics manufacturing or sales, pharmaceutical manufacturing, and beverage manufacturing enterprises shall not exceed 30% of the current year's sales revenue; the excess portion is allowed to be carried over and deducted in future tax years. 2. For affiliated enterprises that have signed an agreement to share advertising fees and business promotion expenses, advertising expenses and business promotion expenses incurred by one party not exceeding the pre-tax deduction limit ratio of sales revenue for the current year can be deducted by the enterprise, or part or all of them can be deducted by the other party in accordance with the apportionment agreement. When calculating the enterprise's advertising expenses and business promotion expenses before corporate income tax deduction limits, the other party may exclude the company's advertising expenses and business promotion expenses according to the above method. 3. Tobacco advertising expenses and business promotion expenses of tobacco companies shall not be deducted when calculating taxable income. 4. This announcement will be implemented from January 1, 2026 to December 31, 2027. The “Notice of the Ministry of Finance and the State Administration of Taxation on Matters Relating to Pre-tax Deduction of Advertising Expenses and Business Promotion Expenses” was abolished on January 1, 2026.