It is still
too early to levy inheritance tax in China (03/11/2003)
It was still too early to collect inheritance tax in China, said Vice-Finance
Minister Liao Xiaojun Tuesday at a meeting on the discussion of matters
related proposals submitted to the first session of the 10th National
Committee of the Chinese People's Political Consultative Conference
(CPPCC), the top advisory body.
Referring to a proposal presented by the China Democratic National
Construction Association on the policy of adjusting the income distribution,
Liao cited views of some experts as saying that the collection of
inheritance tax would do more harms than good to the Chinese economy.
Liao listed numerous reasons for not collecting inheritance tax
at present.
Assets of most private entrepreneurs in China are basically used
as their business operation capital, he said. According to common
practices in other countries, such capital was exempted from paying
inheritance tax or would enjoy a preferential inheritance tax rate.
Most private business people, still in the prime of their lives,
would take many years to inherit the assets and, if such tax was
collected, it would affect the economic growth and would lead to
the outflow of the related capital.
Moreover, inheritance tax was regarded internationally as a complex
tax that was difficult for taxation, and the personal assets declaration
and registration system remained incomplete in China, Liao said.
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