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City applies new personal income tax this month

INDIVIDUAL income tax will be calculated using a new method this month, no matter the salary people receive this month is for August or September, the Shanghai Local Tax Bureau said in a statement yesterday. The online statement came after some people complained that they paid the same income tax this month as they did in August, although China officially raised the personal income tax exemption threshold from 2,000 yuan (US$313) to 3,500 yuan (US$547) on September 1. A local employee surnamed Wu was quoted by Guangzhou Daily yesterday that he still paid the same amount of income tax this month, nothing different from the previous months. The report also said the calculation system upgrade has not completed in some cities such as Xiamen in Fujian Province, making people paying taxes under the old system. It raised people's concerns about government inefficiency in upgrading taxation software after the new calculation method was announced in July. But Shanghai authorities dismissed the accusations yesterday, saying their system has already been upgraded. They also denied that they failed to implement the new tax policy issued by the central government. "We will follow the national policy and apply the 3,500-yuan threshold when collecting individual income tax in September," the statement read. Under the new system which trims tax brackets from nine to seven with rates from 3 percent to 45 percent, a taxpayer whose monthly income is between 8,000 yuan and 12,000 yuan will pay 480 yuan less tax after deducting social welfare contributions. Those earning 19,000 yuan per month will pay 155 yuan less tax. Shanghai tax bureau earlier said taxpayers could apply for rebates through their employers if they found their income tax had been deducted wrongly from their salaries. Anyone can dial 12366 for information or complaints.

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