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China revises individual income tax law

0 Comment(s)Print E-mail Xinhua, June 30, 2011
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China's top legislature on Thursday adopted an amendment to the country's individual income tax law. The amendment raises the monthly tax exemption threshold from 2,000 yuan (307.7 U.S. dollars) to 3,500 yuan (538.5 U.S. dollars).

The adjusted threshold is 500 yuan greater than the amount originally proposed in a previous draft of the amendment, which was submitted to the National People's Congress (NPC) Standing Committee on Monday for its second reading.

The new exemption threshold was agreed upon after the legislature held two meetings on Tuesday and Wednesday to listen to its members' opinions. It was during these meetings that the NPC's Law Committee proposed raising the threshold to 3,500 yuan.

The amendment was "necessary and timely" and will reduce tax burdens for people with low incomes, as well as help to adjust the distribution of income, according to the committee's proposal.

The previous law stated that individuals who earn less than 2,000 yuan (307.7 U.S. dollars) per month are not required to pay income taxes. The draft amendment, submitted for its first reading on April 20, proposed raising the threshold to 3,000 yuan per month.

Many of the nation's citizens previously voiced their dissatisfaction with the 3,000-yuan threshold, appealing to lawmakers to reconsider the amendment.

Before the NPC Standing Committee started its second reading on Monday, the legislature publicized suggestions and opinions solicited from online taxpayers, hoping to acquire useful ideas for lawmakers to consider in their reading of the draft amendment.

Of the 82,707 citizens who commented on the draft amendment, about 83 percent suggested raising the threshold to 3,500 yuan, while 62 percent favored raising it even higher.

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