That is the main logic of reducing taxes to re-establish the policy in 2018, to ease the real economy and to overcome market difficulties. This logical main line is still valid for 2019. As personal income levels increase, the accumulation of property, including direct taxes, such as taxes and real estate taxes, will play a greater role.
On January 1, 2019, the new tax law was officially fully implemented.
"What number is the number, the mortgage agreement, the purchased number has a heap, now I'm a little untidy!"
"Aunt is only 60 years old in July this year. Do you need to fill out the report now?"
"Where can I find the full name of the unit and the tax number?"
In the past two days, many people looked through various documents or materials and entered the list of information numbers in the "Personal Income Tax" application. It takes time for all parties to adapt, but everyone is full of expectations – a payroll tax will be paid in January.
With the introduction of the new tax policy, more people will have a clearer awareness of the collection of state taxes. Thanks to the development of information technology, individuals can easily complete information, including education for children, continuous education, care for major diseases, mortgages and renting and support for the elderly. Citizen information integrated from different departments can be compared and complement each other to create a more complete tax information system for individuals.
Once, direct taxation for individuals was expensive and difficult to achieve, and the future would become easier. This contributes to the optimization of the Chinese tax system. The tax burden on corporate taxation and turnover can be further mitigated, while the percentage of tax revenues for personal income and assets will increase.
It is predictable that with the increase in the levels of personal income and the accumulation of property, including direct taxes, such as taxes and real estate taxes, will have a greater role.
Financial tax reduction
The tax reform introduced with the tax is accelerating, and the theme of the policy of 2018 is "tax cuts". The outer world never wanted to cut taxes as was the case in 2018.
"The only good" scenery on the financial side is an important reason for the call for tax cuts. In the first half of 2018, domestic value added tax and individual taxes increased by 16.6% and 20.3% respectively, which is much higher than the growth rate of 6.8% in the same period.
The Ministry of Finance should constantly explain at the release meeting of each quarter, fiscal revenue is calculated at the current price. GDP is calculated at a constant price, the price of industrial products increases, the profit of the enterprises upstream increases and the level of the income of the residents increases. Various, to reduce tax revenues to achieve faster growth.
At the beginning of 2018, the government has already clarified arrangements for reducing and reducing taxes, including tax deductions, such as value added tax and individual tax. It is expected to cut taxes by 800 billion yuan for businesses and individuals throughout the year. Tax revenues maintain rapid growth and GDP is not caught, which means the government has more points on national income and the overall macro tax burden is rising.
Fiscal revenues maintain a high growth rate, which is contrary to the perceived real economy of the market. In April 2018, the Sino-US trade clashes escalated and the external environment changed significantly. At that time, the financing channels of the market were strained, capital chains of some private enterprises were broken, and their operations became increasingly difficult. Some of the credit events that were deeply linked to local government investment firms reflected the real anxiety.
What happened in 2018, why is the situation with fiscal revenue so unexpected? This should be traced backwards. In fact, 2018 continued the trend of 2017.
Looking at the long-term axis, by reducing the effectiveness of 4 trillion stimulus policies in 2008, China's GDP growth rate continues to decline as a whole since 2010. The introduction of the "new normal" in 2014 is based on this. We need to adjust to the current state of the economy from high speed to medium high speed and we need to understand the "excessive capacity" caused by the stimulus policy.
As part of the government's share of GDP, fiscal revenues will naturally enter the "new normal". Fiscal data for 2013-2016 are very clear. Fiscal revenue favored a remarkably high growth rate of more than 20% and returned to single-digit growth with "low to medium speed".
In the second half of 2016, with the emergence of de-capacity effects, the return of industrial prices in the upstream and the sharp improvement in the profits of enterprises in the upstream, the situation with fiscal revenues has improved. In 2017, the situation with fiscal revenues improved considerably. Monthly tax revenues maintained a two-digit increase, and annual tax revenues registered a growth rate of 10.7%. This trend continued in 2018, with a cumulative increase in tax revenues of 14% in the first half of the year.
Rescue the real economy
Improving the financial situation is one of the signs that the economy stabilizes in 2017. By 2018, it has become a focus of social debate, as both internal and external situations are changing.
In 2018, the interweaving of domestic and foreign factors made the work of downstream private enterprises more difficult, and external factors of insecurity increased, which at the beginning of the year greatly shook the optimistic expectations of the market. Some export-oriented enterprises have gone to export and have expressed concerns about export prospects. Politics has also responded positively, including adjusting the policy to reduce export tax and introducing plans to help affected workers for re-employment.
Fiscal revenues are on the rise, and tax cuts are taken for granted.
In the first half of 2018, the GDP growth rate was 6.8%, which is 0.1% lower than in 2017, while the economic performance remained stable. But there are always different types of news in 2018, which affects market confidence.
In May 2018, total retail sales of consumer goods increased by 8.5% in the month, and the growth rate was lower than that of 15 years ago. The persistent decline in consumer data triggered a market discussion of "exhaustion of consumption".
In the past few years, online shopping has continued to be hot, and the rapid increase in consumption around housing, cars and other major categories has led to a flexible point in 2018. The increase in mortgages, the weakening of wealth and the slowdown in household income made all consumer behavior more rational.
Expanding domestic demand and rising consumer spending quickly became a focus of policy. Among them, the tax reform is accelerating. At the end of June 2018, the tax law was first fulfilled. The first instance was not submitted for voting, and the draft tax law was immediately publicly called for comments. At the end of July, the draft tax bill was completed for comments. There was not much hesitation. At the end of August, the tax law was submitted to the second instance and passed.
By the end of August, the tax law was only adopted, and the company's social security was transferred to the tax collection and management authorities, which made the majority of small and medium enterprises uneasy. The social security premium rate in China is very high, and the real contribution rate is low, which is one of the "initial sins" of many small and medium enterprises. The transfer of social security to tax collection contributes to the unification of rules and also contributes to the sustainable functioning of social security funds, but the application of higher rates will also increase the death of enterprises.
The reduction of social security charges has become urgent and the policy response is fast. In September, executive meetings of two state councils are deployed to study and reduce the social security rate appropriately to ensure that the total burden is not increased.
In the third quarter of 2018, the pressure on the real economy is further increasing, and politics is also overweight. On September 20, Prime Minister Li Kequiang at the Davos Summer Forum said that "a greater tax cut would be implemented and obvious reductions would be made."
Tax cuts for companies
That is the main logic of reducing taxes to re-establish the policy in 2018, to ease the real economy and to overcome market difficulties.
The main line of this policy logic is still valid for 2019. The willingness to invest in the enterprises is not strong, and the growth in consumption of residents is still limited. The company is rushing to free part of the demand in 2019, while external demand is still weak.
The National Finance Conference has more specific arrangements for a tax cut policy of 2019, combining a combination of inclusive tax cuts and a reduction in structural taxes, focusing on reducing the tax burden on production and small and micro enterprises and support the development of the real economy; Enterprises and technology journalists implement inclusive tax incentives, fully implement the revised personal income tax law, implement 6 specific deduction policies, and reduce the tax burden on residents.
The tax cut policy for businesses will be additionally overweight. As the first major tax, the VAT is inseparable. In order to reduce the burden on manufacturing and transport industries in 2018, tax rates of 17% and 11% of value added tax were reduced by 1% to 16% and 10%, respectively.
After the adjustment in 2018, China's value added tax has 16%, 10% and 6% three-rate tax rate, which will switch to third grade and two speeds, and the tax system is more concise and neutral.
Responding to domestic VAT, which rose rapidly in 2018, it is obviously not enough to reduce 1%. It is widely expected that the VAT rate will be further reduced in 2019.
Yang Zhiyong, a researcher at the Chinese Academy of Social Sciences Institute of Finance and Economics, told the 21st Century Business Herald that tax rates of 16% and 10% correspond to the real economy, such as production and are expected to continue to fall . According to the current economic situation, the third and second gear can only be joined at a low rate of tax rate, such as whether to include 10% to 6%, depending on the specific tax cuts.
It is expected to introduce "inclusive tax cuts" mentioned in the fiscal working conference on multiple tax cuts for small and micro enterprises. According to the deployment of the Central Economic Working Conference, in 2019, stable employment should be placed in a prominent position. Many small and micro enterprises play a major role in stabilizing employment.
Will the property tax law accelerate?
Besides the need to stabilize employment and increase the income of residents, it is necessary to reduce the tax burden on enterprises. The trend of consumption growth slows down, and it is also necessary to reduce the personal tax burden.
The comprehensive implementation of the new tax law in 2019 is the main measure of improving the sense of acquiring residents and increasing consumption. Whether the threshold has increased from 3,500 yuan / month to 5,000 yuan / month, or the introduction of special additional deductions, can ease the burden on most taxpayers.
The tax is currently the third largest tax in China after VAT and profit tax. In addition to tax cuts, the new tax policy also intends to optimize the tax system. The tax reform introduces a comprehensive tax system and implements combined taxation of salaries and allowances, compensation for labor, royalties and royalties, designed to improve the tax adjustment function and promote social equity.
"People like us, besides wage earnings, have more labor compensation, under the terms of the new tax law, due to taxation of income, and apply a unified comprehensive tax rate, the highest marginal tax rate is 45%, compared with Before you increase tax burden ". Some scientists from the university told of the 21st century century business news.
Strengthening the function of adjusting individual taxes means that the tax burden on some high-income groups will be restored and their tax evasion space will be further reduced. This work has already been done in 2018, and the typical film and television circle caused by Fan Bingbing has been imposed.
The new tax law opens a new era in which a wider individual is directly linked to tax authorities. In China, most of the tax categories in the circulation relationship fill up the company, and the individual tax also keeps the unit. Although the individual may be the real burden of taxation, he does not participate in the process of tax collection and payment.
After 2019, education for children, continuing education, high medical care, mortgage interest and rent and exclusive deduction of elderly people will require the individual to fill in the relevant information. A comprehensive annual tax payment mechanism requires taxpayers to participate in annual settlement and payment, and enforce multiple tax returns. This is a major change in taxation habits, and the responsibility for taxation is increasingly returning to individuals.
At the moment, these special additional deductions have partly introduced the relationship between husband and wife and the parent-child relationship. By improving tax information for individuals, it will become possible to use the family as a unit for paying tax in the future.
Of course, while everyone enjoys the tax deduction bonus, the same information system will give you personal income, assets and other information will be more complete, and one tax can achieve a higher degree of receivables.
In recent years, as Chinese income has increased, income from individual tax has maintained a relatively high growth rate. In the long term, the growth in income of residents will increase the volume of tax.
Another tax that is directly related to individuals is the real estate tax. In 2018, he was never far from the public eye. At the beginning of March, the news during the two National People's Congress sessions showed that the National Working Committee of the People's Congress, the Ministry of Finance and other relevant parties are working hard to draft and improve the draft law on real estate tax. In April, within the provincial People's Congress and the provincial financial system, the draft was consulted. In September, in the Legislative Plan of the Standing Committee of the National People's Congress, the law on real estate tax was listed as the first type of project, and is proposed to be revised during the current mandate.
Real estate taxes are essential for a fairer tax system. However, with the expectations of stabilizing expectations and boosting confidence in 2019, the main tone is reduced by tax cuts and reductions in fees. The law on real estate tax law can be accelerated nationally, but the sites will still be cautious about their specific landing.
【Author: Zhou Xiao Xiao](Editor: Wang Yuzhuo)