Agriculture Land Planted with Factories
Cover Story
Despite a government decree ordering the removal of illegally constructed factories on agricultural land in Tianjin municipality's Baitangkou village, illicit land seizure and constructions have persisted. The interests of multiple parties are at stake – the villagers are undercompensated, while the companies leasing the factories are ignorant of their illegality.
Original article: [Chinese]

Rethinking Personal Income Tax Deductibles
Editorial
As China progresses from a planned economy to a market system, various social costs have been transferred to the people, including education, healthcare, care of the elderly and social security. In view of that, the government should consider introducing more pre-tax deductible items when amending the Personal Income Tax Law to alleviate such pressures for its citizen. Our editorial argues that an unreasonable taxation framework would only lead to growing trend of tax evasion.
Original article: [Chinese]

Dossier No. 1 to Focus on Agricultural Issues
Cover
The EO has learnt that the 2008 central government's Dossier No.1 – which is the priority policy guideline document issued yearly – is likely to focus on agricultural issues. The dossier is expected to highlight the "three agriculture problems", namely problems face by the agricultural industry, agricultural villages and farmers. Since the introduction of reform and opening up policy 30 years ago, there have been nine such dossiers focused on agricultural themes.
Original article: [Chinese]

Commercial Bank Loan for a Movie
Cover, Human Interest
A war film entitled "The Assembly" – which is expected to be a Chinese blockbuster during the Christmas season – has already created a first before its release. The movie is a pilot model for a commercial bank, China Merchants Bank, to provide loan using an all new risk assessment framework late last year. Unlike other business ventures with fixed assets, a movie has no real value before its completion and no guarantee of returns even upon its release. The bank, however, based on the track records of the production house involved and the reputation of the film's director – Feng Xiaogang – agreed to back a 50 mil yuan loan.
Original article: [Chinese]

Finance Ministry Outlines 2008 Tax Reform
News, page 3
Chinese Ministry of Finance has provided clues to the major emphasis of next year's tax reform. Priority areas include amending laws related to value-added taxes and personal income taxes. The ministry is also going to study the feasibility of introducing environmental conservation taxes and social security taxes.
Original article: [Chinese]

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