Original Title: Notice of the General Office of the People’s Government of Shandong Province on Issuing Several Policy Measures to Promote the High-Quality Development of the Virtual Reality Industry
Several Policy Measures to Promote the High-Quality Development of the Virtual Reality Industry

To further promote the high-quality development of the virtual reality industry, better support the construction of a manufacturing powerhouse and a digital powerhouse, and create new engines and new momentum for building a modern socialist powerhouse in the new era, the following policy measures are proposed.

I. Optimizing the Industrial Development Layout

Accelerate the development of a “1+4+N” regional layout for the virtual reality industry, centered on Qingdao City, with coordinated efforts among Jinan, Weifang, Yantai, and Weihai, and collaborative participation from other cities. Prioritize support for the construction of industrial clusters such as the Qingdao Virtual Reality R&D Hub, the Jinan Virtual Reality Application Base, the Weifang Virtual Reality Complete Systems and Components R&D and Production Base, the Yantai Virtual Reality Industrial Specialized Application Base, and the Weihai High-End Intelligent Hardware Industrial Park.Support other cities in leveraging their existing industrial foundations, defining distinct functional roles, and pursuing differentiated, specialized, and collaborative development. (Lead Agencies: Provincial Department of Industry and Information Technology, Provincial Development and Reform Commission)

II. Increase R&D Investment

Virtual reality enterprises are encouraged to increase their R&D funding. For eligible enterprises, the provincial government will provide subsidies for R&D expenditures at a specified percentage. Implement national preferential policies for additional tax deductions on R&D expenses: for virtual reality enterprises in the manufacturing sector, actual R&D expenses incurred during R&D activities that are not capitalized as intangible assets and are instead expensed in the current period may be deducted on an actual basis as required; in addition, 100% of the actual amount may be deducted from taxable income.if they are capitalized as intangible assets, they may be amortized for tax purposes at 200% of the intangible asset’s cost. (Lead Agencies: Provincial Department of Science and Technology, Provincial Tax Bureau, Provincial Department of Finance)

III. Support for Major Technological Innovation

Coordinate various science and technology programs to provide support for eligible basic research, technological R&D, and technology transfer in the virtual reality sector. Through open competition and other methods, support enterprises in leading industry-academia-research collaborative innovation and tackling key core technologies in the virtual reality field. Provide support in accordance with relevant regulations through government grants (including post-grant subsidies), loan interest subsidies, equity investments, and other means.For the lead institution of projects in Shandong Province that have won the First or Second Prize in the National Natural Science, Technological Invention, or Scientific and Technological Progress Awards, a reward of 5 million yuan will be granted for the First Prize and 1 million yuan for the Second Prize. Seventy percent of the reward funds shall be used for the institution’s scientific and technological R&D and technology transfer, while 30% shall be awarded to the principal contributors (research team).For technology-based small and medium-sized enterprises (SMEs) that obtain loans for technology transfer from commercial banks, a one-time subsidy equal to 40% of the actual interest paid will be provided after the enterprise has fully repaid the principal and interest, with a maximum subsidy of 500,000 yuan per enterprise. (Lead Agencies: Provincial Department of Science and Technology, Provincial Department of Finance)

IV. Promoting the Development of Innovation Platforms

Increase support for the construction of provincial-level and higher innovation platforms. Encourage universities, research institutes, and leading enterprises to take the lead in establishing major science and technology innovation platforms such as National Key Laboratories, National Technology Innovation Centers, National Engineering Research Centers, Industrial Innovation Centers, and Manufacturing Innovation Centers. For newly upgraded platforms that do not require matching funds from the national government, provide 10 million yuan in funding support per platform. Support the Provincial Virtual Reality Manufacturing Innovation Center in its bid to become a National Manufacturing Innovation Center, and implement funding support policies in accordance with relevant regulations.(Lead Agencies: Provincial Department of Science and Technology, Provincial Development and Reform Commission, Provincial Department of Industry and Information Technology, Provincial Department of Finance)

V. Cultivating and Strengthening Leading Enterprises

The virtual reality sector will be designated as a key priority area for the next-generation information technology industry. Incentive rewards will be provided to virtual reality enterprises that demonstrate economic growth, maintain employment levels, achieve outstanding results in green and sustainable development, and rank among the top 10 in the next-generation information technology industry. (Lead Agencies: Provincial Department of Finance, Provincial Department of Industry and Information Technology)

VI. Cultivating Specialized, Refined, Unique, and Innovative Enterprises

For enterprises recognized as provincial-level or higher “Gazelles,” “Unicorns,” “Specialized, Refined, Distinctive, and Innovative” (SRDI) enterprises, or “Single-Champion” enterprises, the Provincial New and Old Growth Drivers Transformation Fund will provide focused investment support through market-oriented mechanisms. Support will be provided to enhance enterprises’ innovation capabilities through models such as “Innovation Service Vouchers.” (Lead Agencies: Provincial Department of Industry and Information Technology, Provincial Department of Finance)

VII. Expand Demonstration and Application

Support enterprises, universities, and social organizations within Shandong Province in establishing public VR application experience centers. Promote the integration of demonstrative application solutions in sectors such as manufacturing, education, culture and tourism, healthcare, and smart cities to facilitate the demonstration and promotion of VR technology in key industries. From 2022 to 2024, select no fewer than five application experience centers annually and provide a one-time subsidy of up to 3 million yuan, covering 20% of their construction costs.(Lead Agencies: Provincial Department of Industry and Information Technology, Provincial Department of Finance)

VIII. Targeted Recruitment of High-End Talent

Establish a linkage mechanism between major virtual reality projects and talent recruitment. Support employers in applying for the “Shandong Talent Card” on behalf of flexibly recruited experts in the virtual reality field. Eligible professional and technical personnel may benefit from the “fast-track” policy for senior professional title evaluation for high-level professionals. Encourage eligible enterprises and new R&D institutions in the virtual reality industry to establish platforms such as postdoctoral research stations and innovation practice bases in accordance with regulations. Make full use of the reward system for cutting-edge technical talent in key industrial chains.(Lead Agencies: Provincial Department of Industry and Information Technology, Provincial Department of Human Resources and Social Security, Provincial Department of Science and Technology, Provincial Department of Finance)

IX. Strengthening the Cultivation of Skilled Talent

Universities are encouraged to collaborate with enterprises to offer specialized virtual reality courses, and enterprises are supported in participating in curriculum development and faculty training. The development of the National Virtual Simulation Experimental Teaching Center, the Virtual Reality Vocational Education Consortium, and public training bases for the virtual reality industry will be enhanced to improve the level of professional skills training. Innovative approaches to vocational skills grading and certification will be implemented, and the hosting of virtual reality-related vocational skills competitions will be supported. (Lead Agencies: Provincial Department of Education, Provincial Department of Human Resources and Social Security, Provincial Department of Industry and Information Technology)

X. Strengthening Resource and Factor Support

For land required for the development of the virtual reality industry, priority shall be given to utilizing existing construction land, provided it complies with territorial spatial planning, protects arable land, and promotes land conservation and intensive use. Where new construction land is absolutely necessary, new construction land quotas shall be allocated in accordance with the principle of “resources following projects,” based on the project’s level. (Lead Agencies: Provincial Department of Natural Resources, Provincial Department of Industry and Information Technology)

XI. Supporting Enterprise Listings and Financing

For virtual reality enterprises that have formally submitted applications for an initial public offering (IPO) on the Shanghai, Shenzhen, Beijing, or Hong Kong stock exchanges, as well as major overseas capital markets, and have been formally accepted, the provincial government will provide a one-time subsidy of up to 2 million yuan in accordance with relevant regulations. (Lead Agencies: Provincial Bureau of Local Financial Supervision, Provincial Department of Finance)

XII. Implementing Tax Incentives

In accordance with relevant national regulations, virtual reality enterprises classified as high-tech enterprises or technologically advanced service enterprises shall be subject to a reduced corporate income tax rate of 15%.For key integrated circuit design enterprises and software enterprises encouraged by the state, corporate income tax preferential policies shall be implemented. For virtual reality enterprises in sectors such as manufacturing, scientific research and technical services, and software and information services that meet relevant policy requirements, the incremental value-added tax (VAT) carryforward credit balance shall be refunded in full on a monthly basis, and the existing carryforward credit balance shall be refunded in a lump sum. (Lead Agencies: Provincial Tax Bureau, Provincial Development and Reform Commission, Provincial Department of Science and Technology, Provincial Department of Industry and Information Technology)

XIII. Effectively Strengthen Implementation

Establish a provincial coordination mechanism for the high-quality development of the virtual reality industry, involving the Provincial Department of Industry and Information Technology, the Provincial Development and Reform Commission, the Provincial Department of Education, the Provincial Department of Science and Technology, the Provincial Department of Finance, the Provincial Department of Human Resources and Social Security, the Provincial Department of Natural Resources, the Provincial Market Regulation Bureau, the Provincial Local Financial Regulatory Bureau, and the Provincial Tax Bureau. This mechanism will comprehensively study key plans, major policies, major projects, and major initiatives for the development of virtual reality enterprises, and coordinate the resolution of resource allocation issues related to talent, land, technology, capital, and data.