(Yicai Global) March 21 -- As the highlight of the current round of fiscal and taxation reform, individual income tax reform requires amendment to the current tax law, and levying of property tax also needs legislation first. However, in the "Notice of State Council Legislative Work Plan for 2017" issued yesterday, these two laws are not among the projects that are to be completed this year.
This means that individual income tax reform and property tax are unlikely to be formally implemented in 2017, but relevant reforms will progress continuously, Yang Zhiyong, researcher from National Academy of Economic Strategy, CASS, told Yicai Global. "Individual income tax reform is very difficult. For example, how to set reasonable tax rates and levels for comprehensive salaries, remuneration and other income is a big problem," Yang stressed.
Property tax is also not included in the 2017 Work Plan. Earlier, Fu Ying, spokesperson of the fifth session of the 12th National People's Congress, also said the property tax draft had not been submitted for consideration at this year's National People's Congress.
The general direction of the property tax system design is to set reasonable tax burdens for various sectors such as construction and trade on the basis of ensuring basic living needs and considering difference between urban and rural housing and commercial real estate, so as to promote the healthy development of the property market while ensuring that the property tax gradually become the sustainable and stable source of income for the local finance. Because of such complex aspects and varying interests involved, property tax program design is also multifaceted and challenging.
In accordance with this round of fiscal and taxation reform plan, the modern financial system will be basically established in 2020, which means the property tax may be officially launched around the same date, Feng Qiaobin, professor at the Chinese Academy of Governance, told Yicai Global.
According to the State Council notice, tobacco tax law, shipping tonnage tax law and regulations on the implementation of the budget law require urgent need of reform in this year's legislative plan, and are included in the projects to be completed this year.