High income earners in China have to declare profits from stocks and property transactions when filing tax returns from next year
Accountancy Age, 19 Nov 2007
The Chinese tax administration has allayed fears the new format of next year's tax form for high-income earners with incomes of more than yuan120,000 (₤7891) a year signalled a new tax on stock trading gains.
The official China Securities Journal reported the new tax form would require separate disclosure of gains from property and stock transactions. Previously, these two categories were undifferentiated in the 'gains in property transfers' category of income.
Earnings from the A-share market are exempt from tax but earnings from property transactions are subject to a 20% tax on the profits.
The state administration of taxation estimates about 1.63m mainland Chinese, or 96% of those earning more than yuan120,000 a year, filed their tax returns earlier this year, according to China's first annual tax-return filing database estimates.
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