The highly paid evaded large amount of taxes

　　Last year the Wall Street Journal brought out the "Ten Richest People in China". However, many of those on the top list evaded from paying income tax because they merged their personal incomesintosthe factory expenditure. The companies are their own properties and so the expenses for their personal use are all calculatedsintosthe factory expenditure prior to paying the taxes.

　　Some high-income earners evade payment of taxes, while at the same time, the gap between the rich and the poor is widening. The phenomenon of personal income tax evasion is serious, and income tax is weak in regulating income differences.

　　As Prof. Hu Angang of the Institute of Public Administration and Management of Tsinghua University holds, the year of 2000 saw the income taxes in China come to RMB 51.1 billion yuan, accounting for only 0.6 percent of the GDP, far below that of the low-earned countries.

　　This shows, the Chinese taxation system is relatively ineffective in the imposition of personal income taxes and most of the highly paid didn't pay enough as what they should have paid. Therefore, China has to learn from the experience of other countries in the world, enforcing the punishment on those who try to evade the tax payment. It has to introduce a taxation policy of structural regulation to raise the imposition line in taxation and raise to a great extent the taxation rate of the highly paid.

　　Persons concerned in the State taxation department told the reporter, they've already taken heed of the facts. Some big bosses of companies put that part of personal income that should pay taxessintosthe expenditure of their companies. This goes against the accounting system. And so persons concerned say measures must be taken to enforce the personal income taxation on the rich of the social strata.

　　According to statistics, in 2001, out of the total deposits of RMB 7000 billion-yuan, that for the less than 20 percent rich people occupied over 80 percent. However, the personal income taxes handed in were short of 10 percent of the total income taxes collected. The main body of the income-tax-payers remains still the salaried employees.

　　As to how much pay a month or how much a person gets is defined as the highly paid, so far the government has no definite norm for it. In fact, this can only be defined in accordance with the local circumstances.

　　To date, the Beijing Taxation Bureau has defined the key taxpayers as those whose annual income are over and above RMB 100,000 yuan, those who have several channels of income and those who need to declare their personal income for a second time and those of the alien nationalities.

　　Moreover according to investigation, there are over 30,000 people in Beijing whose annual income is over and above RMB 100,000 yuan. That is to say, now in Beijing there are at least 30,000 people whose tax payments are to be put under supervision as key taxpayers.

　　The decision to tighten up tax collection from high-income people suggests that China is gradually improving its personal income tax system.

　　The 800 yuan base is likely to be raised

　　Moreover, it is said that China is to reform its personal taxation system. The 22 years old 800 Yuan jumping-off point will be raised. Someone said this was good news and would benefit the large salaried employees.

　　"For ordinary residents, a rise of the threshold from the current 800 yuan (US.4) per month to a higher level does not make any sense, because it will not help them buy expensive products such as cars and houses," said Ni Hongri, a senior researcher with the Development Research Center under the State Council, who claimed an immediate reform would not result in increased consumption., adding they did not lack the money to buy ordinary products.

　　But in the long run, the threshold for personal income taxation should be raised to build up people's purchasing power, she said.

　　Some people argued that the personal income tax reform should takesintosaccount whether the taxpayer has a child to support or elderly family members to look after. The threshold should be more than 1,500 yuan (US.7). On the other hand, the current categorization of personal income taxation needs to be replaced with a more unified system.

　　According to a survey conducted by China Prosperity Supervision Center and CCTV China Economy Report on more than 700 citizens in Beijing, Shanghai and Guangzhou, 23 percent said they were not taxpayers; 24.7 percent said they paid their personal income tax fully and on time; 33.4 percent acknowledged they only paid part of the tax and 18.2 admitted they didn't pay at all. On top of that, 36.9 percent complained that the taxation process is too complicated and time consuming; 26.9 percent said their rights didn't match their obligation, though they are good taxpayers; 20 percent believed the tax was a bit high and, therefore, refused to pay, while more than 10 percent had no idea about tax affairs.

　　Some experts warn that under current conditions, an overly complex tax filing system would be a burden both to taxpayers and collectors because of the amount of time required to calculate how much tax should be paid and to fill out a great number of forms. On the other hand, incomplete policies and regulations will cause unfairness and corruption.

　　Background

　　Nine categories of the highly paid

　　As defined by the State Taxation Administration the highly paid people fallsintosthe following nine categories: private owners of relatively bigger businesses, individually invested enterprises and enterprises of partnership, individual big dealers of industry and commerce; enterprise-contractors or lease-holders and distributors; project-undertakers; executives of institutions and enterprises, members of board of directors, actors and actresses, fashion-models, football coaches and players and sportsmen; brokers of performances, sports and other economic activities; Individually-funded lawyers or of partnership in business; doctors, tour-guides, beauty-parlor hairdressers, chefs and stock-appraisers, musicians or master-musicians, acousticians, designers of interior furnishing and other free-lances and some other people including secretaries of townships and so on and so forth.