From tomorrow, foreigners and overseas Chinese in this southern
city will have to declare their personal income for tax
purposes.
According to a new regulation on income tax, all foreign workers
will be asked to declare their earnings regardless of the length of
time they have spent working in the city.
Overseas Chinese and people from Hong Kong, Macao and Taiwan
will also be required to make declarations.
For those working for a local company, the responsibility to
declare earnings will be with the employer. Those working on a
self-employed or freelance basis will be required to make their own
tax declarations.
Li Jing, an official with Guangzhou local taxation bureau, said
foreign workers with local firms or social organizations should
produce different documents to those required from freelance and
self-employed workers, and people who derive income from a
"one-off" event.
The rule will apply to all foreign workers, including teachers
and researchers, she said.
"Those who fail to submit their income tax declarations on time
will be fined between 2,000 yuan (US$270) and 10,000 yuan. Those
who attempt to falsify their returns will be fined up to 50,000
yuan," Li said.
She said the regulation seeks to better regulate the collection
of income tax and stamp out tax evasion by foreign workers.
Authorities have established a computerized records system and
since May, have been urging businesses to set up files for all
their foreign workers to allow tax collectors easy access to
detailed information on income tax payments, Li said.
Ma Shizhao, an analyst with the Guangdong provincial local
taxation research society, said all foreigners who make their
livings in Guangzhou should pay an appropriate amount of tax. Based
on his own research, he said there are still serious problems
associated with tax declarations.
In the Guangzhou Development District, for example, which is
home to many foreign-funded firms, Ma said about 45 percent of
foreign employees declared their monthly incomes as below 20,000
yuan.
(China Daily October 31, 2007)