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| New policy closes tax loopholes |
| CCTV.COM 2003-07-17 13:07:05 |
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The Chinese Ministry of Finance and the State Administration of Taxation have jointly issued a notice that clearly sets out for the first time how and where business owners will be liable to pay personal income tax.
The notice clarifies that individuals who use company money to buy non－business related items will be liable for personal income tax on such purchases. Individual investors who borrow money from their firms to buy non－business related items and don't repay those money within the tax year will also be liable to pay tax at the personal rate.
The move is designed to prevent business owners from avoiding tax by showing personal spending as company expenditure.
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Editor: Yang Feiyang CCTV.com
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