(Yicai Global) Nov. 1 -- China's finance ministry today issued a draft law on stamp duty for stock trading that proposes to maintain the current rate of 0.1 percent while allowing the cabinet to make changes in future.

The Ministry of Finance and State Administration of Taxation are seeking public opinions on the proposal, the finance ministry said online. Stamp duty is currently collected under provisional rules that have not been legislated.

The main change is that the State Council can now adjust the tax rates on securities transactions in times of need, even if the rate will remain the same for now, the Beijing News cited Jiang Han, a researcher at the Suning Institute of Finance, as saying.

China began imposing stamp duty on securities transactions on the Shanghai and Shenzhen bourses in 1992, four years after rolling out stamp duty on those who close or receive contracts, property transfer documents and other taxable papers.

The tax laws were brought in by the National People's Congress, the country's legislature, which meets less frequently and requires more time to approve changes, making it difficult to quickly adjust to market fluctuations. Allowing the State Council to steer the ship will grant more flexibility over the process.

China accumulated CNY2.1 trillion (USD308 billion) in stamp duty from 1988 through 2017, with an annual average gain of 19.1 percent. It collected CNY220.6 billion (USD32 billion) last year.

Editor: James Boynton