Opinions sought on consumption tax
China unveiled a draft document of consumption tax law and began soliciting public opinion on Tuesday in preparation for the upcoming formal legislation.
According to a statement on the website of the Ministry of Finance and State Taxation Administration, given conditions have matured for legislation, the move is conducive to building a modern fiscal system commensurate with socialist market economy, further opening up, advancing the modernization of China's system and capacity for governance.
The draft maintains the current tax framework and tax burden level, and the consumption tax rate of tobacco and alcohol remains unchanged.
It makes clear the 10 deduction policies for the purchase of taxable consumer goods, covering cigarettes, fireworks, golf balls and club sets, wooden disposable chopsticks, solid wood floors, refined oil, beer, wine, and high-class cosmetics.
Regulations for the management of deducting vouchers are also mentioned in the draft.
According to the document, baijiu should be taxed at 20 percent plus 0.5 yuan per 500 grams (or 500 milliliters) in the procedure of production or import. Gold and silver jewelry, platinum jewelry, diamond and diamond jewelry are taxed at 5 percent in the retail process. Passenger cars, meanwhile, will be taxed in accordance to their cylinder capacity, at rates ranging from 1 to 40 percent.
The State Council may also, in the light of the needs of national economic and social development, provide for certain exemptions or reductions of consumption tax.
In addition, measures for the consumption tax on consumer goods brought into China by individuals or mailed into China shall be formulated by the State Council.
Members of the public can submit their opinions about the draft, which was written by the two agencies, before January 2.