With the convening of the two sessions of the NPC and CPPCC, the contents related to "tax" in the "Report on the Work of the Government" and the "Two High Reports" have aroused widespread concern in society. The tax related proposals made by the representatives of the two sessions have also stimulated discussion on relevant tax systems. In this issue of the "Tax Eyes News" column, the author and readers focus together on the tax related hot spots in the two sessions.

1、 "Government Work Report": Improve tax and fee preferential policies, and optimize the continuation and optimization of existing measures such as tax reduction and fee reduction, tax refund and tax postponement

On March 5, 2023, the second part of the "Government Work Report" by Premier Li Keqiang mentioned, "Suggestions for this year's government work", "Improving tax and fee preferential policies, and continuing and optimizing existing measures such as tax reduction and fee reduction, tax refund and tax postponement."

2、 Maximum prosecution: 58000 people were prosecuted for tax related crimes, up 29.3% from the previous five years

On March 7, 2023, the Procurator General of the Supreme People's Procuratorate, Zhang Jun, made a report on the work of the Supreme People's Procuratorate. In the second part of the review of the work of the past five years, it was mentioned that "focusing on the overall situation of service, promoting high-quality development through active prosecution, and punishing tax related crimes such as defrauding export tax rebates and falsely issuing special invoices for value-added tax in accordance with the law, and prosecuting 58000 people, an increase of 29.3% compared to the previous five years. Some illegal gas stations and black gas stations purchase and sell" non-standard oil ", Hiding income, evading taxes, harming the ecological environment. In public interest litigation investigations, procuratorial organs in Zhejiang and Beijing used big data to screen information such as the driving trajectory and loading and unloading time of oil tankers involved in the case, and found clues of illegal crimes and transferred them to the competent authorities for disposal, with a tax recovery of 360 million yuan. "The Supreme People's Procuratorate cooperates with the State Administration of Taxation to promote the supervision model and jointly solve regulatory difficulties."

3、 Focus on tax related hot spot proposals of the "two sessions"

1. The Central Committee for the Advancement of the People: Accelerate the reform of individual income tax and increase special tax deductions

The Central Committee for Democratic Progress submitted the Proposal on Optimizing the Consumption Structure of Residents and Continuously Implementing the Strategy of Expanding Domestic Demand to the First Session of the 14th CPPCC National Committee. In its proposal, the Central Committee for the Democratic Progressive Movement proposed to promote the improvement of residents' income and continuously promote consumption growth. Continue to promote the implementation of tax and fee reduction policies to increase corporate profits and drive the increase of residents' wage income. At the same time, accelerate the reform of personal income tax, increase special tax deduction items, reduce the tax burden of residents, and strive to expand income supported consumption demand. Deepen the reform of the income distribution system, give full play to the redistribution function of the government, improve the income and wealth distribution structure, focus on and strive to accelerate the income growth of low-income groups, and reduce inequality in income distribution. Improve the basic system of the capital market, encourage the development of the wealth management industry, reasonably guide residents to allocate wealth assets, and ensure that residents can increase their property income through the capital market.

2. Dong Mingzhu: Raise the threshold of individual income tax and protect independent innovation of enterprises

Dong Mingzhu, NPC delegate and chairman of Gree Electric Appliances, proposed "raising the personal income tax threshold to 10000 yuan, standardizing labor regulations related to five insurances and one fund, and protecting the enthusiasm of enterprises for independent innovation."

3. Wang Junshou: Strengthen the coordinated disposal mechanism of financial risks in multiple departments such as finance and taxation, currency, and justice
Wang Junshou, member of the National Committee of the Chinese People's Political Consultative Conference and Secretary of the Party Committee and Director of the Shanghai Banking and Insurance Regulatory Bureau, submitted a proposal on "strengthening the coordinated disposal mechanism of financial risks in multiple departments such as finance, taxation, currency, and justice". Wang Junshou said that the current tax policies are not sufficiently targeted for the risk management of financial institutions. In addition to agricultural and small and medium-sized enterprise loan losses, the disposal losses of a large number of non-performing assets of financial institutions cannot be deducted before income tax, which has increased the cost of disposal to a certain extent, and has also had a certain impact on financial institutions' ability to improve their own risk resistance. It is possible to introduce tax regulations that meet the risk mitigation characteristics of financial institutions, expand the scope of non performing assets that are allowed to be deducted before tax, and effectively reduce disposal costs.

4. Zhong Zheng: We can continue to introduce fiscal and tax preferential policies for digital investment in manufacturing enterprises in the future

Zhong Zheng, deputy to the National People's Congress and Vice President and Chief Financial Officer of Midea Group, proposed solutions from the perspective of finance and taxation to promote the integration and development of the digital economy and manufacturing industry, and promote the digital transformation and upgrading of a number of manufacturing enterprises. In the "Suggestions on Promoting Group Enterprises to Increase R&D and Digital Investment through Fiscal and Tax Policies," Zhong Zheng wrote, "Digital investment is of great significance for high-quality development of enterprises." She suggested that "in the future, fiscal and tax preferential policies can be continued for digital investment in manufacturing enterprises to reduce the burden on enterprises and support their digital transformation."

5. Zhai Meiqing: Standardize the relevant tax treatment of individual investors in the capital operation process

Zhai Meiqing, member of the National Committee of the Chinese People's Political Consultative Conference and chairman of Xiangjiang Holdings, submitted the Proposal on Optimizing the Individual Income Tax Policy for Individual Investors in the Investment Field to the NPC and CPPCC, proposing to "standardize the relevant tax treatment of individual investors in the capital operation process, and play a catalytic role in stimulating the vitality of social capital investment and promoting high-quality development.".

6. Mary: Expand the collection scope of green taxes such as resource tax and environmental protection tax

Ma Li, a representative of the National People's Congress and secretary of the Party Branch of the First Taxation Branch of the Yinchuan Jinfeng District Taxation Bureau of the State Administration of Taxation, submitted two proposals, namely, "Suggestions on Increasing Tax Concessions for the Western Development and Promoting the Development of High and New Technology Industries" and "Suggestions on Further Increasing the Preferential Tax Policies in Ningxia to Support the Construction of Ecological Protection and High Quality Development Pilot Areas in the Yellow River Basin.". In her proposal, she proposed to improve the current policies, such as "dynamically adjusting the catalogue of encouraged industries in the western region every year", and "expanding the collection scope of green taxes such as resource tax and environmental protection tax".

7. Xie Ru: Improve supporting policies such as facilities, talent, financing, and taxes, and strengthen supervision of elderly care services

Xie Ru, member of the National Committee of the Chinese People's Political Consultative Conference and vice chairman of the Jiangxi Provincial Committee of the Chinese People's Political Consultative Conference, suggested that "we should focus on complementing the weak and weak points, strive to actively address the aging population with Chinese characteristics, improve employment support policies for the elderly such as industrial injury insurance, training, tax reduction, subsidies, and improve support policies such as facilities, talent, financing, taxes, and strengthen the supervision of elderly care services."

8. Zhuo Changli: Include family consumption for elderly care and patient care into the scope of personal income tax deduction

"Zhuo Changli, a representative of the National People's Congress and chairman of Sunshine Big Sister Group, suggested that" the consumption of families for elderly care and patient care should also be included in the scope of personal income tax deduction, so as to truly reduce the burden and benefit families with patients and elderly people. "

9. Yang Shuang: Give preferential policies in terms of land, funds, taxes, subsidies, etc. to childcare institutions run by social forces

Yang Shuang, member of the National Committee of the Chinese People's Political Consultative Conference and executive vice president of the Transplantation Medicine Research Institute of Nankai University, suggested that "enterprises and institutions, communities, and maternal and child health centers at all levels should be encouraged to participate in the construction of childcare services, and preferential policies should be given to childcare institutions run by social forces in terms of land, funds, taxes, subsidies, and other aspects. At the same time, appropriate restrictions should be placed on the charging standards."

10. Liu Qingfeng: It is recommended to optimize the equity incentive tax nodes of listed companies

Liu Qingfeng, deputy to the National People's Congress and chairman of iFLYTEK, put forward several suggestions on optimizing the equity incentive policies of listed companies. Liu Qingfeng suggested, "Adjust the payment time point of the individual income tax related to the equity incentive income of listed companies to the income realization stage, which is the 'actual sale date', in line with the policies of non listed companies, and enhance the sense of acquisition of employees. At the same time, reference the transfer income of shares granted to the equity incentive objects of listed companies to the income from restricted shares, and uniformly calculate and pay the individual income tax at the rate of 20% applicable to the 'property transfer income', to ensure the equity incentive effect, and stimulate the talent creation of technology enterprises." "New spirit, unleashing innovative vitality."

11. Feng Yidong: Refine Individual Pension Tax Policy Differentiation

Feng Yidong, member of the National Committee of the Chinese People's Political Consultative Conference and general manager of Zhongtai Securities, made relevant suggestions on optimizing the supporting system of personal pensions. Feng Yidong suggested, "Refine the differentiation of individual pension tax policies. Set tax preference levels based on the gradient of individual tax payment levels, and appropriately increase the investable amount and individual tax deduction level for middle and high income groups. For individual pension amounts invested before the income level reaches the individual tax threshold, a 3% individual pension tax can be exempted upon receipt. Explore the gradient setting of pension tax rates based on the duration of continuous participation and account balance to encourage individual income earners." Participate in high-level groups and effectively expand the contribution amount of individual pension accounts. In addition, he also suggested that the tax incentives for the second and third pillars of the pension security system should be coordinated in combination with financial affordability and individual pension substitution goals. In particular, enterprise employees who participate in enterprise annuities can enjoy a higher level of tax incentives. "We will increase policy support and set a differentiated proportion of tax incentives and subsidies based on working years to encourage more young people to 'dare to invest, be able to invest, and take the initiative to invest' when allocating the third pillar."

12. Yao Jinbo: Reduce the value-added tax on second-hand cars by 0.5% and determine it as a long-term policy

Yao Jinbo, a representative of the National People's Congress and 58 local CEO, proposed in his proposal that in 2020, the Ministry of Finance and the State Administration of Taxation jointly issued the "Announcement on VAT Policies for Used Car Distribution", which specifies that from May 1, 2020 to December 31, 2023, taxpayers engaged in used car distribution who sell their purchased used cars will be subject to a reduced value-added tax rate of 0.5% instead of a reduced value-added tax rate of 2%. With the introduction of policies such as temporary license plates and reverse invoicing in October 2022, the relevant policy system has been basically improved, gradually playing a significant role in supporting high-quality distribution enterprises to become bigger and stronger, and promoting automobile consumption. Therefore, Yao Jinbo suggested, "In order to consolidate the previous achievements and efforts, and ensure that the policy system continues to play its due value, it is recommended to determine a long-term value-added tax policy for second-hand car dealers at a reduced sales rate of 0.5%."

13. Feng Xingya: Exchanging the purchase tax on the battery part for the tram type

Feng Xingya, NPC delegate and General Manager of GAC Group, "Suggestions on Several Measures to Boost Automotive Consumption and Drive National Economic Growth in the Post Epidemic Era", "Suggestions on Improving the Application Rate of Domestic Chips and Promoting the High Quality Development of China's Automotive Chip Industry Chain", and "Suggestions on Accelerating the Promotion of New Energy Vehicle Power Exchange Modes and Accelerating the Transformation of the Automotive Industry" were submitted. He suggested, "Accelerate the overall layout of the nationwide promotion of power exchange models, study and introduce various support policies for power exchange models, support and reward automobile companies to introduce policies to encourage the introduction of power exchange models and increase the separation of vehicles from electricity. After the state cancels the tax exemption policy for the purchase of new energy vehicles, the purchase tax for the battery part of the power exchange model will be exempted."

14. Zhu Qi: It is recommended to reduce the tax on the import of returned cultural relics and artworks

Zhu Qi, member of the National Committee of the Chinese People's Political Consultative Conference and general manager of Shanghai Duoyunxuan Group Co., Ltd., submitted the Proposal on Reducing and Reducing the Import (Export) Tax on Returned Cultural Relics and Artworks in response to the issue of customs duties on cultural relics and artworks. "Zhu Qi proposed that in terms of import value-added tax, it is recommended to exempt value-added tax on" works of art, collectibles, and antiques originating in China "during the import process, and clarify it in the national value-added tax law; In terms of import tariffs, it is recommended to adjust the current import and export tariffs by adding a sub heading of "originating in China" to all categories in the "Art, Collectibles, and Antiquities" section, with a zero tax rate; In terms of import tax (postal tax), it is recommended to adjust the current import tax rate table for imported goods, adding a sub heading of "originating in China" to "stamps, artwork, and collectibles", and granting a zero tax rate. In addition, it is recommended that the returned cultural relics and works of art be reported to the Chinese cultural relics import and export examination department for identification through the line in advance, and the customs formalities for duty-free import (exit) should be handled with the identification certificate.