Targeted deductions crucial to tax reforms

Raising the individual income tax threshold is always in the public's interest. But since an indiscriminate increase in the threshold will neither be fair nor serve the purpose of China's tax reforms, the authorities have decided to adopt various exemption standards to ease different income groups' financial burdens.

The Government Work Report mentions applying different exemption standards for different sectors to charge individual income tax; the application also found mention at the finance minister's news conference during the just-concluded annual sessions of China's top legislature and top political advisory body.

The pace of the tax reforms, however, should be progressive, with the individual income tax reform leading the overall reform process. The reforms will ease the financial burdens of families and individuals if they can help improve people's livelihoods. That's why some have suggested that the expenses for raising a second child, supporting the elderly and acquiring professional training should be deducted from an individual's taxable income, because it will provide incentives for people to better fulfill their responsibilities.