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Total income, including salary, allowances, subsidies and bonuses are subject to personal income tax for people employed by the government and publicly-funded institutions, according to a taxation notice published Friday jointly by China's Finance Ministry and the State Administration of Taxation.

 

The notice clarifies the tax situation for people working for the government and publicly-funded institutions.

 

With the ways in which income is provided changing, some government agencies and publicly-funded institutions have given out subsidies and bonuses to their employees, which haven’t been counted in their personal income tax liability, tax officials said.

 

Tax evasion, refusing to pay tax, and all behavior aimed at preventing investigation by the tax administration will be punished, according to the notice.

 

China's top legislators adopted a revised Personal Income Tax Law last October, raising the threshold for monthly personal income tax from 800 yuan to 1,600 yuan (US$198).

 

In 1994, China began levying income tax on citizens earning more than 800 yuan (about US$100) but only 1 percent of people were earning more than that; now, about 60 percent earn that much.

 

(CRI February 12, 2006)