Speech by Xie Xuren, Commissioner of the State Administration of Taxation January 24, 2007 |
Ladies and Gentlemen: Happy New Year! This time last year, I shared here with you the views on the issue of taxation and it is my great pleasure to have the opportunity to meet you again today.I hereby, on behalf of the State Administration of Taxation, extend my gratitude to all the new and old friends for your attention and support to the taxation work all these years. You have already got the script of my speech. Now, I would like to brief you on the taxation work last year and the plans for this year. The total tax revenue remitted to the treasury in 2006 amounted to 3.7636 trillion yuan, 21.9 percent up and 677 billion yuan more than the previous year. The tax revenue grew at a steady and fast pace in line with the economic development. It greatly enhanced the country’s financial strength, increased the supply for public goods and service and provided strong financial support for the country’s efforts to build a moderately prosperous society in all respects and to create a harmonious socialist society. The fast growth in tax revenue in 2006 is a reflection of the steady and speedy growth of the national economy and the large increase of the enterprise profits. The growth is also attributable to the support of various levels of governments and CPC committees and various sectors of the society as a whole as well as taxpayers’ enhanced awareness of tax compliance. All this constitutes a good social environment for the revenue increase. Another contributing factor is the efforts of tax administrations across the country to move taxation work under the rule of law and strengthen tax administration work, to implement the scientific and refined management overall, and to improve the quality and efficiency of tax administration. All this guarantees the steady and fast increase of tax revenue. The taxation work was pushed ahead under the rule of law last year.Great efforts were made to regulate and standardize the taxation order while the revenue mobilization principles of “taxation by legislation, collecting all due taxes in full and no taxes ahead of the due time, and allowing no unauthorized granting of tax reduction and exemption” were strictly followed.Tax reforms have been deepened. The revised Individual Income Tax Law and its Implementation Rules were implemented and the Excise Tax was reformed. The unification of two Corporate Income Tax Laws for domestic enterprises and foreign investment enterprises was moved forward and the standards for pre-tax deduction of salary were raised in the Corporate Income tax. The pilot program of VAT conversion continued in some industries in northeast China. The tax adjustment and control measures and preferential policies were fully carried out. The Business Tax policy was adjusted for the house property transfer. The export refund policy was adjusted and improved. The fixed tax amounts for the gold and the coal resource taxes in some provinces were raised. Tax incentives for scientific and technological advancement and for employment and re-employment were implemented. Tax administration has been intensified and the taxation economic analysis and enterprise tax assessment strengthened. The Tax Registration Licenses have been re-issued across the country to enhance the administration of VAT, Corporate Income Tax and other taxes. The computerization of management system was boosted and the taxpayer service was improved and optimized. Tax investigation was enhanced, tax arrears settled and collection rate raised. The tax staff’s capacity building was enhanced and a good public image established for the tax departments. 2007 is an important year to fully implement the scientific outlook on development and to actively create a harmonious socialist society. The general requirements for the taxation work this year are: take Deng Xiaoping Theory and the important thought of Three Represents as our guide, fully implement the scientific outlook on development, closely follow the guidelines set out at the fifth and sixth plenary sessions of the Sixteenth Central Committee of Communist Party of China (CPC) and the Central Economic Work Conference, seriously carry out the policies and requirements for taxation work made by the Party Central Committee and the State Council, hold to the mission of revenue collection for the country and law enforcement for the people, further bring the taxation work under the rule of law, steadily implement the tax reform, strengthen scientific management across-the-board, build a even stronger tax working force, ensure a steady and fast tax revenue growth in line with the economic development, give full play to the role of taxation as an instrument of regulating economy and distribution, and make new greater contributions to building a moderately prosperous society in all respects and to create a harmonious socialist society. In 2007, we will make great efforts to do the following. Firstly, regulate the tax law enforcement and intensify the taxation by legislation. We will accelerate the construction of tax law system in strict accordance with the legislation power and procedure to draft and improve tax laws, rules and regulations. We will, under the Implementing Outlines for Promoting Law-based Administration in an All Round Way by the State Council, perform our duty of strict law enforcement, maintain the revenue mobilization principles and strengthen the supervision of law enforcement. Neither can the due tax payment be postponed, nor can the tax be collected ahead of the due time for the purpose of progress adjustment. And the transfer of tax revenue among different tax departments is strongly prohibited. We will deepen the responsibility system of the tax law enforcement, spread the law enforcement administration information system, and conduct inspections focusing on the law enforcement, implementation of revenue mobilization principle, and execution of preferential tax policies, especially the tax policies concerning the corporate income tax and the real estate industry. We will strengthen the tax investigation of significant cases. We will severely crackdown the VAT overstatement and acceptance of overstated VAT invoices and other documents against which credit may be granted for tax rebate fraudulent and also the tax evasion cases in which falsified accounts, two separate account and outside-account operation are practiced. We will launch special inspections on individual income tax of high-income industry employees and on the enterprises engaged in such industries as real estate, construction and installation, catering and entertainment, finance and insurance, oil and petro-chemistry, food and pharmaceutical production, use and operation of scraps, agricultural products and by-products processing, chain supermarkets, etc. We will also strengthen the tax law publicity and education and enhance the public awareness of honest compliance with the tax obligations. Secondly, take steady steps to promote tax reforms and make concrete efforts to implement tax policies. We will make proactive yet steady efforts to deepen the tax reform and give full play to the taxation as an instrument of raising revenue and regulating the economy and distribution to meet the need of the socialist market economy and macro-adjustment and control. We will summarize the experience of the pilot VAT conversion program to accelerate the pilot programs in the central and west China and to make an implementation scenario for the whole country. We will promote the unification of the two separate Corporate Income Tax Laws for the domestic and foreign invested enterprises, and make preparations for the review of the new Corporate Income Tax Law by the National People’s Congress (NPC), and preparations for publicity and implementation after the new Law is passed. We will push forward the resource tax reform, implement the new Provisional Regulations on Urban and Township Land Use Tax and the Provisional Regulations and Detailed Implementation Rules on Vehicle and Vessel Use Tax, and improve the Farmland Occupation Tax. We will boost the comprehensive agricultural reform with policies favorable for and conducive to the development of agriculture. We need to make supporting tax policies to promote the development of science and technology and the capacity for independent innovation. We will develop the tax policies for employment and re-employment to establish a harmonious labor relationship. We will continue to implement the tax incentives for the progress of the western region and the revitalization of the northeast industrial base. We will put all the tax preferential policies into practice and oversee the implementation. Strongly prohibited are the extension of special tax incentives and tax reduction and exemption against the laws and regulations. Thirdly, make great efforts to promote scientific and refined management in a bid to enhance the quality and efficiency of tax administration. We will enhance the revenue source management and set up an interactive mechanism between the tax audit and the tax economic analysis, tax assessment, and revenue source monitoring. We need to move forward and implement the tax administrator system by proceeding from the tax registration management and strengthening the desk and field investigation of the taxpayer’s identification. We will practise the classified management on the territorial basis. We will intensify the management of common invoices, supervise and urge the enterprises to offer invoices for each transaction, and see if the filing is done for the given invoices. We will widely spread and apply the tax-monitoring meters and the prize-winning invoices and invoice inquiry system. We need to strengthen the administration of tax arrears to guard against the appearance of new tax arrears while settling the old. We will further improve the One-Stop service for VAT filing and standardize the VAT e-filing. We will also improve the excise tax management by clearly defining the exact items of some taxes, especially the excise tax administration of fuel, diesel, alcohol, beer and gold and silver ornaments. We will intensify business tax administration for each different industry and launch the tax-monitoring system for road and inland river transportation invoices, strengthen the tax base management, tax assessment and the annual final settlement as far as the corporate income tax is concerned. We will further enhance the tax administration of individual income tax (IIT) by implementing the IIT self-filing measures with an emphasis on the high-income taxpayers, IIT withholding and property transfer. We will strengthen and improve administration of such local taxes as the Urban Real Estate tax, the Urban and Township Land Use, Land Appreciation Tax and Vehicles and Vessels Use License Plate Tax. And we will streamline the integrated management of the real estate tax and the Vehicles and Vessels Use License Plate Tax on the basis of computerization to improve the administrative efficiency of the relevant taxes. Fourthly, intensify and optimize the taxpayer service with an aim to creating harmony between tax administration and tax compliance. We will practice just and civilized tax law enforcement to protect the lawful rights and interests of taxpayers with an aim to improving tax compliance, accessibility and convenience for taxpayers and full payment of due taxes in a timely manner. In tax administration, we need to pay attention to lessening the tax filing burden and simply and combine different filing materials to avoid repeated tax reporting for taxpayers. We will reasonably simplify the tax filing procedures through the One-Stop Service for tax filing and tax-related matters and provide multi-methods of tax filing and payment for the convenience of taxpayers. We will also strengthen the publicity of tax laws and regulation and initiate the consulting and assistance so that taxpayers are familiar with the tax laws and tax filing procedures. Fifthly, plan the Third Phase Gold Tax Project and quicken the steps for IT system construction for tax administration. We will speed up the design and development of the tax administration software and its application system construction. We will make great efforts to launch the information system of IIT administration, the pilot comprehensive office information system, and the taxpayer service hot-line 12366 in a nationally unified mode. We will enhance the data management and application by standardizing data collection and verification to ensure one-time collected and automatically created genuine data can be shared and used for many parties. Both the SAT Headquarter and the SAT Offices at the provincial levels should regularly release those data and use them to do tax economic analysis and to guide the grassroots office for tax assessment and revenue source management while the grassroots offices use them to provide better administration and services. Sixthly, push forward the administrative reform and innovation in order to improve performance efficiency. We will change the government function and promote the law-based government administration to suit the socialist market economy. We will strengthen the public service function of the tax departments and correctly deal with administration and service. We will carry out the Administrative Licensing Law and deepen the tax reform of administrative examination and approval system. We will adhere to scientific and democratic decision making. The running of the governance is to be made fully transparent in content, forms and procedures. We need to raise the awareness of serving the grassroots and to further simplify meetings and documentations. We will optimize the working procedures, perfect a responsibility system for different posts and regulations, and push ahead the scientific and refined internal administrative management. We will strengthen the government procurement management and financial management. We will establish financial responsibility system by objectives through budget management and execution, and effective fund use. We will carry out the basic guarantee system for the grassroots expenditure, track and check the spending, and ensure that the fund use favors the central and western regions, the grassroots offices and the tax administration. We will stick to law-based procurement and improve the centralized government procurement to serve the grassroots for fund saving and efficiency. We will adhere to performing duty under the rule of law in a friendly way to appropriately settle the reasonable appeals and complaints through letters and visits. Seventhly, enhance the quality and capacity building for tax staff. We will strengthen the top management teams and arm their minds with the Deng Xiaoping Theory and “Three Represents” and the idea of creating a harmonious society with a scientific outlook to development. We will also optimize the organizations and structures of the top management teams.We will adhere to the principle of democratic centralism, strengthen unity and coordination, and improve our governance capacity. We must implement the Civil Servant Law and deepen the human resource system reform for leaders. We will practise talent strategy and intensify the education and training in size, quality and effectiveness. We will start the ideological and political education for the long run to boost the construction of tax culture which promotes the core value of tax collection for the country and law enforcement for the people. We will call upon the tax staff to follow the professional work ethic of just law enforcement, service with integrity, and being clean and devoted, the cooperative team spirit of helping each other, and the responsible working style of striving for perfection. Being realistic and pragmatic, we will keep the innovative spirit and strive to make progress. We will promote the anti-corruption and pro-probity strategy by both punishment and prevention on the basis of education. We will implement the regulations on probity and self-discipline for tax staff and the oversight measures for the top management and the leaders and supervise the tax law enforcement and administrative management power. Now my colleagues and I would be willing to answer your questions.
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