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Income tax cutoff point lifted to 1,600 yuan
(Xinhua)
Updated: 2005-10-23 09:15
China's monthly personal income tax cutoff point was lifted to 1,600 yuan
from 1,500 yuan after drawing on public opinions from the first-ever legislature
hearing held on Sept. 27.
The cutoff point of 1,600 yuan has been written into the amendment draft of
the personal income tax law, which was submitted to the 18th session of the
Standing Committee of the 10th National People's Congress (NPC), beginning on
Saturday, for the second reading.
The amendment draft was probably voted for adoption at the six-day
legislative session.
China's monthly personal income tax cutoff point has been fixed at 800 yuan
for more than ten years.
In August, top legislature read the amendment draft of law on personal income
tax for the first time. The draft proposed lifting the monthly personal income
tax cutoff point from 800 yuan to 1,500 yuan, so as to accord with the economic
growth and ease tax burden of poor citizens.
But on the parliamentary hearing, most participants held that the tax cutoff
point of 1,500 yuan was still low and should be further raised.
According to the newest statistics offered by the NPC Standing Committee,
among 20 participants of the parliamentary hearing, six believed that the
deduction point of 1,500 yuan was appropriate, 12 thought the cutoff point
should be higher and another two held that the personal income tax cutoff point
should be lower than 1,500 yuan.
After a full consideration of public opinions from the hearing,the draft
amendment of the law on personal income tax for the second reading, lifted the
personal income tax cutoff point from 1,500 yuan to 1,600 yuan.
"The difference of 100 yuan might be a slight change for the personal income
tax reform, but a "big step forward" for the country's democratic progress,"
acknowledged Yang Qin, a participant of China's first ever legislative hearing
who is working for the Guangdong Foshan branch of China Netcom.
Though Yang held that 2,000 yuan should be an ideal monthly personal income
tax cutoff point in his speech at the parliamentary hearing, he still felt
satisfied with the result, because "public opinions have influenced the
country's legislation and policy making," he told Xinhua.
He Yongjian, an official with the Legislative Affairs Commission under the
NPC Standing Committee, said the adjustment of tax deduction point should fully
consider not only public opinions, but China's financial capability, and the
present national conditions.
The state coffer could afford the monthly personal income tax deduction point
of 1,600 yuan, and tax collection from high-income groups will be intensified to
refill the central finance, said He.
Moreover, he explained the personal income tax deduction point only slightly
lifted this time, also because too high income tax cutoff point may cause a
sharp decrease of tax revenue in those under-developed provinces and weaken the
central finance's capacity to support the development of poor areas.
He said the parliamentary hearing on personal income tax deduction point has
drawn enthusiastic response from people of all circles of society. And China's
20-plus provincial legislative bodies had held legislative hearing. China's top
legislature was trying to sum up experience and might finally form a regular
parliamentary hearing system, in an effort to further ensure the country's
legislative transparency.
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