A draft amendment to the individual income tax law is submitted to the third session of the 13th National People's Congress standing committee for deliberation on June 19, 2018.
However, due to the low level of productivity and per capita income, China implemented a low-wage system, and although taxes were set up, they were never levied.
After the promulgation and implementation of the above three tax laws and regulations, they have played a positive role in adjusting personal income level, increasing national fiscal revenue, and promoting economic and technological cooperation and exchanges with foreign countries.
On January 28, 1994, the state council issued the regulations for the implementation of the individual income tax law of the People's Republic of China.
600, and the revised regulations for the implementation of the individual income tax law of the People's Republic of China came into effect on September 1, 2011.
The fifth session of the standing committee of the 13th National People's Congress, which was amended for the seventh time, was held on Aug 31, 2018.
Subsequently, on December 22, 2018, the interim measures for special additional deduction of individual income tax issued by the state council [2018] No.
707 were issued, together with the regulations for the implementation of the individual income tax law of the People's Republic of China.
[1] On 31 August 2018, the NPC passed the Draft Amendment to the People's Republic of China (PRC) IIT Law, and it takes its effects on 1 January 2019.
Effective October 1, 2018[7] Tax exemption can be applied on following types of personal income[8] 1.Prizes in science, education, technology, culture, health, sports, environmental protection, etc.
awarded by provincial people's governments, ministries and commissions of the State Council, units above the Chinese People's Liberation Army, as well as foreign organizations and international organizations 2.Interest on national debt and financial bonds issued by the state 3.Subsidies and allowances issued in accordance with the unified regulations of the state 4.Welfare, pension, and relief 5.Insurance claims 6.Soldier's transfer fee, demobilization fee, retirement allowance 7.Settlement allowances, retirement allowances, basic pensions issued to cadres and employees in accordance with the unified regulations of the state 8.Income of diplomatic representatives, consular officers and other personnel of foreign embassies, consulates in China that should be exempted from tax in accordance with relevant laws 9.Tax-exempt income stipulated in international conventions and agreements signed by the Chinese government 10.Other tax-exempt income stipulated by the State Council Note that both, tax rate and quick deduction, are based on the 'income' AFTER the 'tax exemption': the 'taxable income'.
2019 is the first year these deductions were put into operation, and thus is considered a "trial" stage for the program and may be rescinded on notice.
According to the 2023 "State Council Notice on Raising the Standards for Personal Income Tax Special Additional Deductions," the following will be implemented starting from January 1, 2023:[12] 1.