Ministry Of Finance For The First Time Whether To Respond To A Tax Threshold Raised Controversy - A

Ministry of Finance announced yesterday, "the basic situation of China's personal income tax

," the report, for the first time a positive response to "a tax threshold should be raised whether the" debate: a substantial increase in threshold, the high-income groups benefit more than the interests of low-income groups but rather damaged.

However, the report said, according to economic development, consumer spending, the market price level changes, the next a tax threshold will be adjusted in due course.

High income tax contribution to the large

The personal income tax issues by the Ministry of Finance Study Group's Report revealed that more than 120,000 yuan in mid-2008 from self-reported number of taxpayers 240 million, accounting for about 3% of personal income taxpayers; pay the tax to 129.4 billion yuan, accounting for personal income tax of 35% of total income; self-declaration to make more concentrated in the electricity, Financial , Oil , Telecommunications and other departments and company shareholders, executives and other professional enterprises.

Report, China now a tax threshold to 2,000 yuan / month, "one gold and three insurance" can be found in pre-tax deduction, while the one-child subsidies, childcare subsidies, wages, retirement income tax exemption By this calculation, a monthly salary of 2,500 yuan or less pays no income tax, while the monthly salary of 3,000 yuan, 5,000 yuan, 8,000 yuan and 10,000 yuan of the taxpayer, their tax payable a tax of about 20 yuan, 175 yuan, 535 yuan and 825, the tax burden (tax payable / month wage income) were 0.7%, 3.5%, 6.7% and 8.3%, no more than 10%.

Raise threshold benefit the rich more

The report explained that the Ministry of Finance, China's personal income tax and always carry out "more than high-income tax, low-income tax or less tax," the spirit, and that the threshold will not help in improving low-income people, it will affect the interests of low-income groups.

Reported a substantial increase in costs if the current standard deduction, benefit is more than high-income, middle income earners benefit less. Example, the standard will be charged up to 3,000 yuan / month, a monthly salary of 5,000 yuan can only reduce the tax burden of taxpayers 100 yuan / month, while the monthly salary of 10 million taxpayers, tax reduction 350 yuan / month; will be deducted standards to 5,000 yuan / month, a monthly salary of 5,000 yuan taxpayers 175 / month, while the monthly salary of 10 million taxpayers 1050 yuan / month; the standard deduction increased to 10,000 yuan / month, a monthly salary of 5,000 yuan benefit taxpayers still only 175 / month, while the monthly salary of 10 million taxpayers will benefit 2,800 yuan / month.

And raise a tax threshold, the disadvantaged groups and low-income people not only can not benefit, they became the main interest groups affected. "A tax is mainly used for grants and other vulnerable groups, if the deduction increase too much, a significant reduction in the high income taxes, state revenues are reduced, the state subsidies for low-income groups, and social security, Education And medical expenses also be affected. "

"Comprehensive + classification" tax reform have to wait

Report mentions, on the personal income tax reform, "comprehensive and classified tax system" is the goal. This tax is part of the project to the year-end taxable income to be comprehensive, progressive tax rate applicable to other taxable items of income on a pro rata rate of category collection. The tax model can better solve the classification problem of unfair tax burden on existing tax system, but requires the appropriate collection and related conditions, without collection and management measures with and protect, in theory, a more equitable tax system design in practice but may greater injustice.

by: gaga

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