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PIT legislation will apply equally across the nation

Whether you live in a luxury apartment with a butler and maids on the 30th floor in Shanghai, or lay your head in a yurt in Inner Mongolia, you will be subject to the same income tax regulations, according to the National Tax Administration. At a meeting Saturday the administration said it "has not considered differentiation" of tax laws across China.

Cong Ming, an inspector from the State Administration of Taxation Policy and Regulation Department, said the standpoint for personal tax reform is to reduce the tax burden for the middle- and low-income classes and a tax increase for high-income earners. Part of the changes will include raising the minimum taxable amount to 3,000 yuan ($461) a month, up from the current 2,000.

Officials are still collecting opinion on the draft amendment. So far, more than 220,000 people have submitted their thoughts to the National People's Congress website since April 25.

According to Cong, after tax reform, the government will only collect 120 billion yuan, compared to personal income taxes of 483.72 billion yuan last year.

"The sweeping regulations show the uniformity of the tax system of the country; as tax income is a symbol of national sovereignty," Yang Shengming, a researcher from the Chinese Academy of Social Sciences, or the nation's think tank, Sunday told the Global Times.

According to Yang, the government can adopt "flexible measures" such as giving subsidies to undeveloped regions after collecting the tax in a bid to narrow gaps in different cities.

However, Li Daokui, an advisor to the central bank's monetary policy committee, said in a forum in Shenzhen last Wednesday that it is not reasonable to have the same threshold across the country due to different living costs in different cities.

"For residents in cities like Shenzhen with a high cost of living the start point should be 5,000 to 6,000 yuan, and 3,000 yuan for those cities with low costs," Li explained.

China began to collect individual income taxes in 1980 for those with monthly incomes of 800 yuan or more, and the starting point jumped to 2,000 yuan in 2008 when resident income in urban areas increased to an average of 1,315 yuan per month.

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