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Commentary: China/Tax Cuts
Beijing, China - Jan 18, 2019 (CCTV - No access Chinese mainland)
1. Screenshot of China Media Group (CMG) commentary on chinaplus.cri.cn
FILE: Beijing, China - Date Unknown (CGTN - No access Chinese mainland)
2. Various of Chinese Ministry of Finance
FILE: Beijing, China - June 2017 (CCTV - No access Chinese mainland)
3. Entrance to Taxpayer Service Hall of Beijing's Xicheng District
4. Service hall
Beijing, China - Jan 18, 2019 (CCTV - No access Chinese mainland)
5. Screenshot of China Media Group (CMG) commentary on chinaplus.cri.cn
6. Animation showing tax cut policies for companies in 2019
Shenzhen City, Guangdong Province, south China - Recent (CCTV - No access Chinese mainland)
7. Taxpayer service hall
8. Various of taxpayers filling forms at service hall
FILE: China - Exact Location and Date Unknown (CCTV - No access Chinese mainland)
9. Taxpayers at service hall
10. Information on replacement of business tax with value-added tax
FILE: China - Exact Location and Date Unknown (CCTV - No access Chinese mainland)
11. Various of staff members in office
12. Various of machines, mechanical arms at factory
Shanghai, China - Jan 4, 2019 (CCTV - No access Chinese mainland)
13. Various of workers assembling microchips
Beijing, China - Jan 18, 2019 (CCTV - No access Chinese mainland)
14. Screenshot of China Media Group (CMG) commentary on chinaplus.cri.cn
FILE: China - Exact Location and Date Unknown (CCTV - No access Chinese mainland)
15. Tax officers receiving taxpayers
16. Bill out of printer
17. Tax officers receiving taxpayers
Beijing, China - Jan 18, 2019 (CCTV - No access Chinese mainland)
18. Screenshot of China Media Group (CMG) commentary on chinaplus.cri.cn
Shanghai, China - Recent (CCTV - No access Chinese mainland)
19. Tax officers
20. Invoice
21. Various of machine printing invoice
22. Tax department office
China's new favorable tax policies for its small and micro enterprises aim at propping up its economy, according to a commentary carried by China Media Group (CMG) on Friday.
The translated version of the commentary is as follows:
At the beginning of the New Year, China's government launched new policies that respond to the downward pressure on economic growth. They include tax reductions for small and micro enterprises, which will be in place for three years. This is the first among a series of tax cuts and other stimulatory measures for 2019, and is expected to give a huge boost to the country's economic development.
Most companies in China will enjoy a tax cut this year. This is because the new policies are targeted at companies with assets under 50 million yuan, fewer than 300 employees, and taxable income of less than three million yuan. This represents a significant relaxation in the definition of what constitutes a small business. More than 95 percent of taxpaying enterprises in China fit this definition, and 98 percent of them are private firms.
The market is expected to respond positively to these unprecedented tax cuts, which will see small and micro enterprises enjoy progressive tax rates. Enterprises with taxable income of less than one million yuan will be taxed at 5 percent, which is 20 percentage points lower than the standard rate. And those with a taxable income between one million and three million yuan will be taxed at 10 percent, which is lower than the standard rate by 15 percentage points.
The new deal will also raise the value-added tax (VAT) threshold for small businesses, including sole traders, from 30,000 yuan to 100,000 yuan of sales a month. In other words, businesses with sales worth less than 100,000 yuan will be exempt from paying the VAT. At the same time, the central government is allowing local governments to reduce resource taxes, urban maintenance and construction taxes, stamp duty, urban land use taxes, and cultivated land occupation taxes, as well as local education surcharges.
According to tax department figures, China's small and micro enterprises already had their tax burden reduced to the tune of 184 billion yuan in the first 11 months of last year. And official estimates show that this new round of cuts will reduce the burden on small businesses by another 200 billion yuan a year. This will undoubtedly enhance private investment and consumption, at a time when the global economic downturn and the unresolved trade frictions between China and the United States have put pressure on China's economy, especially in sectors related to trade.
The measures China takes to deal with the cooling economy at home and abroad, and the growing pushback against globalization, has far-reaching global implications, as the country is home to the world's second largest economy. There are more than 100 million businesses in China, and small and micro enterprises account for the vast majority of them. Their healthy development helps to fuel the job market: As China's Premier Li Keqiang has said, these enterprises are the main channel for absorbing employment, and part of the government's rationale for introducing the tax cuts is that they will support employment. This will, in turn, be conducive to both the immediate and long-term development of the country's economy. But leaving small business owners with more money in their pocket means there will be less cash in the government's coffers. This is why Premier Li has urged government agencies to cut costs and raise awareness that government budgets will tighten.
In November, China's President Xi Jinping spoke highly of private enterprise and private entrepreneurship at a meeting with representatives of the business community. He promised to reduce the burden of corporate taxes and fees, and the tax reductions being introduced this year are a demonstration of him making good on that promise. Combined with the broader measures being introduced to help pump prime the economy, such as the move to cut the number of sectors closed to foreign investment (the negative list of market access), the broad-based tax cuts will help to improve China's business environment so that it will withstand the downward pressures.
Commentary: China/Tax Cuts
Dateline : Jan 18/4, 2019/Recent/File
Location : China
Duration : 2'53
Beijing, China - Jan 18, 2019 (CCTV - No access Chinese mainland)
1. Screenshot of China Media Group (CMG) commentary on chinaplus.cri.cn
FILE: Beijing, China - Date Unknown (CGTN - No access Chinese mainland)
2. Various of Chinese Ministry of Finance
FILE: Beijing, China - June 2017 (CCTV - No access Chinese mainland)
3. Entrance to Taxpayer Service Hall of Beijing's Xicheng District
4. Service hall
Beijing, China - Jan 18, 2019 (CCTV - No access Chinese mainland)
5. Screenshot of China Media Group (CMG) commentary on chinaplus.cri.cn
6. Animation showing tax cut policies for companies in 2019
Shenzhen City, Guangdong Province, south China - Recent (CCTV - No access Chinese mainland)
7. Taxpayer service hall
8. Various of taxpayers filling forms at service hall
FILE: China - Exact Location and Date Unknown (CCTV - No access Chinese mainland)
9. Taxpayers at service hall
10. Information on replacement of business tax with value-added tax
FILE: China - Exact Location and Date Unknown (CCTV - No access Chinese mainland)
11. Various of staff members in office
12. Various of machines, mechanical arms at factory
Shanghai, China - Jan 4, 2019 (CCTV - No access Chinese mainland)
13. Various of workers assembling microchips
Beijing, China - Jan 18, 2019 (CCTV - No access Chinese mainland)
14. Screenshot of China Media Group (CMG) commentary on chinaplus.cri.cn
FILE: China - Exact Location and Date Unknown (CCTV - No access Chinese mainland)
15. Tax officers receiving taxpayers
16. Bill out of printer
17. Tax officers receiving taxpayers
Beijing, China - Jan 18, 2019 (CCTV - No access Chinese mainland)
18. Screenshot of China Media Group (CMG) commentary on chinaplus.cri.cn
Shanghai, China - Recent (CCTV - No access Chinese mainland)
19. Tax officers
20. Invoice
21. Various of machine printing invoice
22. Tax department office
China's new favorable tax policies for its small and micro enterprises aim at propping up its economy, according to a commentary carried by China Media Group (CMG) on Friday.
The translated version of the commentary is as follows:
At the beginning of the New Year, China's government launched new policies that respond to the downward pressure on economic growth. They include tax reductions for small and micro enterprises, which will be in place for three years. This is the first among a series of tax cuts and other stimulatory measures for 2019, and is expected to give a huge boost to the country's economic development.
Most companies in China will enjoy a tax cut this year. This is because the new policies are targeted at companies with assets under 50 million yuan, fewer than 300 employees, and taxable income of less than three million yuan. This represents a significant relaxation in the definition of what constitutes a small business. More than 95 percent of taxpaying enterprises in China fit this definition, and 98 percent of them are private firms.
The market is expected to respond positively to these unprecedented tax cuts, which will see small and micro enterprises enjoy progressive tax rates. Enterprises with taxable income of less than one million yuan will be taxed at 5 percent, which is 20 percentage points lower than the standard rate. And those with a taxable income between one million and three million yuan will be taxed at 10 percent, which is lower than the standard rate by 15 percentage points.
The new deal will also raise the value-added tax (VAT) threshold for small businesses, including sole traders, from 30,000 yuan to 100,000 yuan of sales a month. In other words, businesses with sales worth less than 100,000 yuan will be exempt from paying the VAT. At the same time, the central government is allowing local governments to reduce resource taxes, urban maintenance and construction taxes, stamp duty, urban land use taxes, and cultivated land occupation taxes, as well as local education surcharges.
According to tax department figures, China's small and micro enterprises already had their tax burden reduced to the tune of 184 billion yuan in the first 11 months of last year. And official estimates show that this new round of cuts will reduce the burden on small businesses by another 200 billion yuan a year. This will undoubtedly enhance private investment and consumption, at a time when the global economic downturn and the unresolved trade frictions between China and the United States have put pressure on China's economy, especially in sectors related to trade.
The measures China takes to deal with the cooling economy at home and abroad, and the growing pushback against globalization, has far-reaching global implications, as the country is home to the world's second largest economy. There are more than 100 million businesses in China, and small and micro enterprises account for the vast majority of them. Their healthy development helps to fuel the job market: As China's Premier Li Keqiang has said, these enterprises are the main channel for absorbing employment, and part of the government's rationale for introducing the tax cuts is that they will support employment. This will, in turn, be conducive to both the immediate and long-term development of the country's economy. But leaving small business owners with more money in their pocket means there will be less cash in the government's coffers. This is why Premier Li has urged government agencies to cut costs and raise awareness that government budgets will tighten.
In November, China's President Xi Jinping spoke highly of private enterprise and private entrepreneurship at a meeting with representatives of the business community. He promised to reduce the burden of corporate taxes and fees, and the tax reductions being introduced this year are a demonstration of him making good on that promise. Combined with the broader measures being introduced to help pump prime the economy, such as the move to cut the number of sectors closed to foreign investment (the negative list of market access), the broad-based tax cuts will help to improve China's business environment so that it will withstand the downward pressures.
ID : 8101050
Published : 2019-01-19 06:21
Last Modified : 2019-01-22 11:01:00
Source : China Central Television (CCTV)
Restrictions : No access Chinese mainland
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