One hundred million yuan in taxes is unrealistic for any private enterprise these days. Let alone one hundred million, even if an enterprise pays more than fifty million yuan in taxes in a year, the municipal government will give it a reward, such as land, the title of major taxpayer, or even a rebate.
The current tax system is not perfect, and the penalties are not severe enough; there is always negotiation and compromise between the municipal government and businesses.
Lu Feng was in a hurry to set up a group company in order to avoid taxes and make the company more financially secure. If taxes had to be paid, it wouldn't matter whether they were paid in Suzhou or Shenzhen.
“President Lu, things are different now than before. Shenzhen is now like the sun at nine o’clock in the morning, and land is no longer as fertile as cabbage. Let me be blunt: Jiafeng Electronics’ two factories, one in Suzhou and one in Dongguan, don’t provide us with much employment. Moreover, I am aware of your development model.” Vice Mayor Liu pondered for a moment and said, “In my opinion, profitability is a long way off.”
When a large enterprise moves in, a city will definitely provide corresponding policy support and preferential treatment, whether it's land, tax exemption, or financial assistance.
What this city wants is to create jobs, foster the development of the industrial chain, and increase tax revenue. However, Lu Feng cannot provide any of these three things, yet he wants to take the land for free. Of course, the city will not agree to that!
“I understand what you mean, but our R&D company is located here, and our headquarters is also located here. In the future, this will be the core office location of Jiafeng Electronics.” Lu Feng realized that the other party did not see any hope for the next three to five years and did not want to give up the land. In this case, he had to find a way to make him take a longer-term view.
"Jiafeng Electronics is destined to become a world-renowned enterprise. I believe that a wise leader can see further than an entrepreneur, not just three or five years into the future, but ten or twenty years from now. What can Jiafeng Electronics bring to Shenzhen? Now we need Shenzhen, and in the future I believe Shenzhen will need us."
Lu Feng thought for a moment and said, "Moreover, we can sign a contract for the land use rights, stipulating that we will not sell the land within ten years. Most importantly, once we complete the Jiafeng Building, it will also add a landmark building to the city. I still hope you can give it more consideration. If we only look at the present, Shenzhen is indeed at a slight loss, but if we look at the long term, I believe that this city will definitely achieve a win-win situation in terms of boosting employment, supporting industries, and tax revenue."
Vice Mayor Liu glanced at the others beside him, and everyone smiled without saying a word. They had long heard that the chairman of Jiafeng Electronics was not easy to deal with, and today they had seen it for themselves. If you talk to him about tax tiers, he will talk to you about all of humanity. If you tell him frankly that it is not worthwhile, he will talk about the next ten or twenty years.
"We'll discuss this further, but Shenzhen's doors are always open to outstanding companies like yours," Vice Mayor Liu said, offering a few polite words.
By noon, the foreign trade agency was in an uproar. A large number of reporters rushed to interview the company after hearing the news, and some afternoon newspapers even had to be redesigned and expedited for publication.
The chairmen of 26 foreign trade agencies spoke out, and the president and secretary of the China Foreign Trade Association also gave interviews, condemning Jiafeng Electronics for ruining the prospects of the home appliance industry's export due to its own selfish interests.
In less than two hours, the incident had spread beyond the industry. After the major afternoon newspapers were published, some individuals and small businesses that were already dissatisfied with Jiafeng Electronics began to lash out.
“In the international export arena, and in the global trade environment, our position is quite low. A few months ago, Jiafeng Electronics entrusted us to export a batch of goods. At that time, we were just trying our luck. Over the past few months, we have put in a lot of hard work, and finally, we sold the first batch of goods. This marked the first time that a private enterprise in our country exported television sets.”
Li Guangfa, with a serious expression, said in a deep voice to the reporter: "What a wonderful thing this is! When we proposed to continue increasing exports, we hoped to continue our cooperation. However, Jiafeng Electronics felt that as the manufacturer, it wanted to gain more profits, completely disregarding our efforts. Such behavior is shameful and hateful in business!"
He loudly denounced Lu Feng, while recounting how hard he had worked to promote Jiafeng Electronics' products, how he had slept in parks, spent three days carrying dry rations, besieged international companies, and been turned away countless times.
Lu Feng's meeting with the municipal government had ended. It was lunchtime, and the two sides stood up, shook hands, exchanged pleasantries for a while, and then walked out.
As soon as he stepped out of the reception room, he was surrounded by a group of reporters. Vice Mayor Liu didn't know what was going on and asked in confusion, "What's wrong?"
"Excuse me, what is your response regarding the matter between Jiafeng Electronics and Guangfa Trading Agency?" a reporter asked Lu Feng directly.
Lu Feng was also a little puzzled. How come this matter had attracted so many reporters?
"While this meeting was taking place, the chairman of Guangfa Trading publicly stated that the two companies had cooperation in export trade, but you, relying on the advantage of Jiafeng Electronics as a manufacturer, refused to cooperate, thus closing the door to exporting home appliances that had been opened with great difficulty. How do you explain this?"
Lu Feng truly didn't expect him to pull such a stunt, triggering public opinion to force him into a corner.
"This is a matter between our two companies. We can't just listen to one side of the story. We'll discuss the specifics privately," Lu Feng said, giving a vague answer.
"Currently, 26 foreign trade agencies have spoken out, and relevant personnel from the China Foreign Trade Association have also spoken out, hoping that the manufacturing industry will not think of itself as an upstream industry. While it is indeed impressive to produce goods, the credit of those who sell them should not be ignored. They hope for a fairer distribution of profits, the formation of industry standards, and stronger support for Chinese products to go global. What is your response to this?"
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