foreign-funded enterprises have employee incentives and welfare funds. Article 58 of the Detailed Rules for the Implementation of the Law on Foreign-capital Enterprises (Order No.31 of the People's Republic of China and the State Council of China) stipulates that the profits of foreign-capital enterprises after paying income tax in accordance with the provisions of the tax law of China shall be drawn from the employee bonus and welfare fund. Enterprise welfare fund refers to a special fund formed by the part of after-tax profits left to the enterprise according to regulations from the realized profits, in addition to the income tax and adjustment tax.