Tax Levy and Administration News
- Tax return system finds few takers
Date: 5-Mar-2007 Sources: (Shenzhen Daily)
THE country's new tax return system has drawn a low response in some cities although tax authorities had received 400,000 declarations by March 1 from the country's high-earning residents with annual income of more than 120,000 yuan (US$15,400).
The new system requires those who earned more than 120,000 yuan last year to voluntarily report last year's earnings to tax authorities in the first three months of 2007.
The number of declarations received is far lower than the number expected in some cities, said an unnamed official with the State Administration of Taxation (SAT), without revealing more details.
Those who fail to make a declaration before the deadline will bear the legal liability, warned the official, saying that tax authorities possess information about most high-income earners and can find out who they are.
The SAT issued a regulation on the new system in November last year, stipulating fines ranging from 2,000 to 10,000 yuan for those who fail to make a declaration and fines of up to 50,000 yuan for false reports.
By the end of last year, tax authorities had set up files on 20million taxpayers across the country, including five million in Beijing, said the official.
It is estimated that 300,000 to 350,000 people earn more than 120,000 yuan per year in Beijing, according to previous reports.
This is the first time that the Chinese tax authorities have required high-income earners to report their annual earnings. Tax officials said this will not lead to double tax payments because income taxes will continue to be deducted at source by employers.
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