The current income tax rate in China is 25%, and the profit tax in Hong Kong is 16.5%, which is far lower than the domestic tax rate.

Now domestic foreign trade companies use Hong Kong companies for entrepot trade, which can not only save tax revenue, but also facilitate foreign exchange collection and reduce exchange rate losses. For SOHO companies or individuals without import and export rights, they can also take the initiative in capital to protect the information of foreign customers from being leaked.

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