Regulations for the Implementation of the Personal Income Tax Law of PRC were issued by China's State Council on Jul 27 and will come into effect on Sep 1. Changes have been made in accordance with the revised Individual Income Tax Law. The tax-free threshold for individuals will be raised from 2,000 yuan per month to 3,500 yuan per month. The threshold for foreigners living in the PRC will remain at 4,800 yuan per month, meaning that the first 4,800 yuan of a foreigner's pay packet will not be taxed.

Once the new regulations come into effect, people who make 3,500 yuan per month will have their income tax burden reduced by 125 yuan a month. Those earning 5,000 or 10,000 a month will pay 280 yuan and 480 yuan less in income tax a month respectively. Approximately 60 million people will be exempt from paying income tax and annual revenue from income tax will be reduced by 160 billion yuan, according to Wang Jianfan, head of the tax department in the Ministry of Finance.

Source
Xinhua News Agency

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