Cuts in taxes and fees are also part of China's efforts to stimulate business activity amid the ongoing trade frictions.

Tax and fee cuts reduce companies' costs so that they can spend more on production upgrades and compete for a larger market share both at home and overseas.

For instance, the Fourth Construction Co., Ltd. of China Electronics System Engineering (CEFOC) used to pay two million yuan (about 290,000 U.S. dollars) in pension funds every month for 1,300 employees. 

But a new policy effective this month would save the company one-fifth of that amount going forward. "The company will put that money into improving semiconductor technologies," said Fan Xiaolin, vice president of CEFOC. 

The deductions are also becoming more inclusive to encourage quality growth, based on Fan Yong, a professor from Public Finance and Tax at Central University of Finance and Economics.

"For a very long time, only those registered as high-tech companies got additional tax cuts for their R&D costs. Now it's more inclusive – any company, as long as it spends on R&D, can get additional deductions," the professor explained.

With all those measures taken, China's tax revenue in the first quarter rose 6.1 percent year on year after taking out the refund on exports, which was roughly in line with the GDP growth rate.

The country will continue to optimize business environment by shortening the negative list for foreign investors and streamlining the approval process, with three weeks being cut down to 8.5 days for opening a company, and seven down to four months for starting a construction project.