Chinese lawmakers deliberate revisions to income tax law

Source: Xinhua| 2018-08-29 20:40:41|Editor: mmm
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BEIJING, Aug. 29 (Xinhua) -- Chinese lawmakers on Wednesday reviewed revisions to the individual income tax law during panel discussions at the ongoing bi-monthly session of the National People's Congress (NPC) Standing Committee, which runs from Monday to Friday.

According to a draft amendment to the law, the minimum threshold for the personal income tax exemption is expected to be raised from 3,500 yuan (about 512 U.S. dollars) to 5,000 yuan per month or 60,000 yuan per year.

It also adds special expense deductions for items like caring for the elderly, children's education, continuing education, treatment for serious diseases, as well as housing loan interest and rent.

The revisions have lived up to the will of the people and are conducive to improving tax equity, thus enabling taxation to better play its role in adjusting income distribution, lawmaker Zhang Chunxian said during panel discussions.

The central authorities' will to reform taxation is aimed at reducing the burden on taxpayers by raising the threshold of the individual income tax exemption and adding the category of special expense deductions, Zhang said.

Lawmaker Wang Dongming said the revisions will help lower-and-middle income groups increase their income, and then bridge the income gap and advance a more reasonable and orderly pattern of income distribution.

There should be a special expense deduction item for raising children as the cost for raising children is mounting in China, lawmaker Shen Yueyue suggested.

Lawmaker Feng Zhonghua suggested that related authorities should conduct research on a specific range, standards and enforcement of the special expenses deductions, so as to ensure lower-and-middle income groups share the benefits.

According to the draft law, the State Council should set the range, standards, and enforcement steps for the special expense deductions and then report to the NPC Standing Committee.

The individual income tax was the third major contributor to China's total tax revenue, following value-added tax and enterprise income tax. In 2017, China collected individual income taxes worth nearly 1.2 trillion yuan, about 8.3 percent of the total tax revenue.