On December 29, 2021, China decided to extend the period of some preferential policies on individual income tax:
According to CCTV news broadcast, on December 29, 2021, Premier Li Keqiang, in order to reduce the burden of individual income tax and ease the pressure on the middle and low income groups, it is decided that:
- The policy of withholding annual bonuses in the current month’s income of wages and salaries, and implementing separate monthly taxation will be extended to the end of 2023.
- Exemption from overdue tax will be extended to the end of 2023 for those who have an annual income not exceeding RMB120,000 and are required to pay unpaid tax, or whose annual settlement of unpaid tax does not exceed RMB400.
- Separate taxation on equity incentives for listed companies will be extended until the end of 2022.
A total of RMB 110 billion tax will be reduced benefiting from the above policies per year.