On November 7, the website of the Shenzhen Taxation Bureau released a tender document for the fourth phase construction project for a personal tax application platform focusing on “high-income and high-net-worth” groups. The total bid amount is nearly $280 million (2 billion yuan). The announcement attracted high public attention.
High-net-worth individuals refer to those with bank deposits of around $1.4 million.
Financial commentator Cai Shenkun told RFA on Thursday, “It will face the whole country soon, and there will be no dead ends. Because they (the CCP) had long wanted to launch the fourth phase of the ‘Golden Tax,’ there may be some internal resistance. He (Xi Jinping) is afraid of scaring away these so-called ‘high net worth individuals.’” Now that taxes and fiscal revenue have fallen sharply, he has to take such measures, and sooner rather than later.
Chinese financial media Liuyan Commune and Asian Finance have also revealed that the CCP regime has established a “Management Authority for High-Net-Worth Individuals,” and conducted a special tax audit on this group.
In the future, “Tax Golden Phase IV” will apply smart tax methods to collect information about each taxpayer and create a corresponding big data module for the taxpayer profile.
At the same time, the cancellation of the household registration tax was introduced for migrants.
Additionally everyone who wants to leave China must go to the tax office to issue a tax clearance certificate.
Netizens discussed enthusiastically. Some netizens mocked that this was one of Xi Jinping’s methods to promote “common prosperity.”
According to Bloomberg calculations based on data released by the Ministry of Finance on October 26, the fiscal deficit of all levels of the CCP regime reached $1 trillion (7.16 trillion yuan), a record year-on-year.
From January to September, China’s fiscal revenue fell by 6.6% on a natural basis and tax revenue fell by 11.6%.
On June 21, Hou Kai, the National Audit Office of China, said in a report that from 2018 to 2021, 544 high-income people in 22 provinces and cities had evaded $650 million of personal income tax.
According to the Chinese National Civil Service Administration website, the national civil servant exam 2023 is expected to recruit 37,100 candidates.
Nearly 25,000 of them are headed into the tax system. Scholars believe that this is related to the launch of the “Golden Tax Phase IV” system.
Financial commentator Yang Jiaqing told RFA that the new tax reform plan aims to solve the problem of the inability to carry out tax checks for high-income groups and make up for the shortfall in tax revenue.