Total income, including salary, allowances, subsidies and
bonuses are subject to personal income tax for people employed by
the government and publicly-funded institutions, according to a
taxation notice published Friday jointly by China's Finance
Ministry and the State Administration of Taxation.
The notice clarifies the tax situation for people working for
the government and publicly-funded institutions.
With the ways in which income is provided changing, some
government agencies and publicly-funded institutions have given out
subsidies and bonuses to their employees, which haven’t been
counted in their personal income tax liability, tax officials
said.
Tax evasion, refusing to pay tax, and all behavior aimed at
preventing investigation by the tax administration will be
punished, according to the notice.
China's top legislators adopted a revised Personal Income Tax
Law last October, raising the threshold for monthly personal income
tax from 800 yuan to 1,600 yuan (US$198).
In 1994, China began levying income tax on citizens earning more
than 800 yuan (about US$100) but only 1 percent of people were
earning more than that; now, about 60 percent earn that much.
(CRI February 12, 2006)