Latest news with #StateTaxationAdministration
&w=3840&q=100)
Business Standard
3 days ago
- Business
- Business Standard
China's overseas income tax global crackdown expands beyond ultra-rich
China is intensifying efforts to collect taxes on citizens' overseas income, expanding its scrutiny to less wealthy individuals after targeting the ultra-rich last year, according to people familiar with the matter. Officials are now scrutinizing a broad range of offshore income, including investment returns, dividends and employee stock options, said the people, asking not to be identified discussing private information. Investment gains can be taxed as much as 20 per cent. Tax service providers have seen a surge in inquiries in recent months from clients with less than $1 million in assets, a notable shift from last year's crackdown that largely targeted individuals with at least $10 million. Chinese residents with offshore investments, especially in US and Hong Kong stocks, are a key focus of the tax authorities, one of the people added. The State Taxation Administration didn't immediately respond to a request for comment. At the same time, Chinese investors have been shifting more wealth overseas as the economy has struggled and after a crackdown on private enterprise. President Xi Jinping's push for 'common prosperity' has also dented confidence, though the Chinese leader has recently made a high-profile push to shore up confidence among entrepreneurs. Mainland investors have poured about HK$658 billion ($83.9 billion) into Hong Kong-listed stocks via the cross-border trading link so far this year, according to Bloomberg calculations, more than double the outflows for the same period last year. China's Ministry of Finance sees room to boost revenue by tightening tax collection on income that's subject to individual income tax but hasn't been declared by the taxpayer or identified by tax authorities, according to a person with knowledge of the matter, who asked not to be named speaking about confidential discussions. The ministry didn't immediately respond to a request for comment. Total income in the Chinese government's two main fiscal books fell 1.3 per cent year-on-year in the first four months of the year, while expenditure soared 7.2 per cent. That prompted the budget gap to swell by more than 50 per cent to upwards of $360 billion, the most ever for the period, according to Bloomberg calculations based on data from the Finance Ministry. Tax bureaus in Beijing, Shanghai, and provinces such as eastern Zhejiang have urged residents to check their overseas gains and make tax declarations by June 30, when the reporting season for 2024 income ends, according to notices seen by Bloomberg as well as public statements. Local authorities have acted in concert since at least late March after their big data analysis discovered some residents had failed to declare their offshore gains for taxation, according to government records. In cases publicized by the tax offices, the amount that residents were asked to pay back in overdue tax and fines was as low as 127,200 yuan ($17,720). China's tax push also followed its 2018 implementation of the Common Reporting Standard, a global information-sharing system aimed at preventing tax evasion. While local regulations always stipulated that residents be taxed on worldwide income, including investment gains, it had rarely been enforced until last year. Under the CRS, China has been automatically exchanging information with nearly 150 jurisdictions about accounts belonging to people subject to taxes in each member country for the past few years. Personal investable assets in mainland China could soar to $80 trillion by 2030, with overseas investments rising to 11 per cent of households' investable assets, up from its 8 per cent in 2023, according to Bloomberg Intelligence.
The Star
15-05-2025
- Business
- The Star
Exporters pivot to home market amid headwinds
Chinese exporters to the United States are increasingly pivoting to the domestic market as overseas demand softens, with official tax data showing a steady uptick in local sales in April. Industry experts said that the shift reflects how Chinese manufacturers are reducing their reliance on the US market amid trade tensions triggered by the US' tariff moves, and it also aligns with China's broader push to boost domestic consumption for long-term economic growth. According to the State Taxation Administration, Chinese companies that export their products to the US reported a 4.7 percent year-on-year increase in domestic sales last month. The share of domestic sales in their total revenue also rose by 2 percentage points compared with the first quarter. Out of 31 major manufacturing sectors, 21 saw domestic sales take up a larger share of revenue. Leather and footwear producers saw the sharpest shift in April, with the domestic share of sales up 10 percentage points from a year earlier. Other industries with notable increases included computer and telecommunications equipment, ferrous metals, furniture and food processing, all of which recorded gains of more than 5 percentage points in the domestic share of their total sales in April. Zhang Juan, deputy director of the Shanghai WTO Affairs Consultation Center, said that in today's climate of growing uncertainty, including trade tensions between China and the US, shifting from exports to domestic sales is "no longer a short-term work-around". "It has become a long-term strategy jointly driven by businesses and the government. Relying on both domestic and international markets is clearly the more stable path forward," she said. Nearly 85 percent of Chinese exporters are already engaged in domestic sales, which account for around 75 percent of their total revenue, according to Zhang. Among these companies is Olod, a kitchenware manufacturer based in Yiwu, Zhejiang province. The company once relied on shipping 500,000 cookware units annually to North America, Europe and the Middle East. But trade tensions and rising costs prompted it to shift 70 percent of its export-oriented goods to the domestic market. Li Xiongfei, head of Olod, said, "Even though trade tensions are easing, the challenges we faced until now, including a slump in orders and rising costs, showed how vulnerable we are without a strong foothold at home. It made us realize that export alone is not sustainable." The company now conducts livestreaming e-commerce on WeChat, China's largest social media platform, and its daily sales revenue has exceeded 1 million yuan ($138,800). "If global trade is open, we're in. If not, we've got 1.4 billion people right here to do business with," said Li. "You've got to walk on two legs — balancing both domestic and overseas markets — if you want to go far and stay steady." Since April, major Chinese e-commerce and retail companies have fleshed out plans to assist foreign trade companies in broadening domestic sales avenues, such as opening green channels, joining hands to develop new products, and pooling marketing resources. These trends also align with China's broader push to boost domestic consumption to stabilize the economy. This year's Government Work Report made strengthening consumer spending the nation's top priority, emphasizing the need to boost the supply of quality products. Peng Jianzhen, president of the China Chain Store & Franchise Association, said: "Many export-oriented products introduced to the Chinese domestic market have already proved successful in developed countries. With the right adjustments to fit local tastes, there's a huge potential for these products at home." - China Daily/ANN
South China Morning Post
07-04-2025
- Business
- South China Morning Post
China love guru who teaches women how to marry rich faces US$1 million tax evasion fine
Self-styled 'McKinsey of relationships' teaches that relationships, marriage are strategic tools for climbing social, financial ladder A controversial Chinese 'love guru' who teaches women how to marry wealthy men and reportedly earns 142 million yuan (US$20 million) a year is facing a 7.58 million yuan (US$1.1 million) fine for tax evasion. The scandal surrounding the guru, who is known as Ququ Big Woman, was recently revealed by China's State Taxation Administration. The case of the internet celebrity, whose real name is Le Chuanqu, was one of five announced by the authorities, and it has attracted the most attention. Le is one of China's most controversial internet celebrities and reportedly earns 142 million yuan a year dishing out dating and financial advice. She went from being a singer to becoming a self-proclaimed 'McKinsey of relationships', promoting the idea that relationships and marriage should be used as strategic tools for climbing the social and financial ladder. Le Chuanqu reportedly earns millions of yuan a year dishing out dating and financial advice. Photo: In August 2023, live-streaming clips featuring her controversial views on dating and relationships went viral. Her online courses were offered in tiers, with the most affordable package, titled 'valuable relationships,' priced at 3,580 yuan (US$500) for 24 sessions. Newsletter Every Friday Lunar By submitting, you consent to receiving marketing emails from SCMP. If you don't want these, tick here {{message}} Thanks for signing up for our newsletter! Please check your email to confirm your subscription. Follow us on Facebook to get our latest news. The package claims to help clients master the social, romantic and financial aspects of relationships. A one-on-one consultation during her live-streams costs 1,143 yuan (US$160), while her private coaching packages exceed 10,000 yuan (US$1,400) per month. Le was criticised by state media in 2023 for promoting toxic relationships and spreading misleading values. She was subsequently banned from several social media platforms. However, her business continued to thrive, shifting from the public spotlight to more private domains, as many still view her teachings as essential life lessons. In December last year, her team announced that the fee for her private membership group, 'Girlfriends Alliance,' had increased from 129,800 yuan (US$18,000) to 199,800 yuan, with prospective members being required to pass an interview to join. According to Shanghai Municipal Tax Service, State Taxation Administration, tax authorities used big data to uncover discrepancies in her financial affairs. While her private consultation business was supported by a large loyal group of followers, she declared a personal income of only 600,000 yuan (US$82,000) over the past two years, in stark contrast to her actual earnings. The tax authorities in Shanghai have ordered Le to pay a total of 7.58 million yuan in back taxes, late fees and fines. China's tax authorities have come down heavily on internet celebrity Le, and she has been criticised in state media. Photo: Le said that she deeply recognised the negative impact she had on society and pledged to take the matter as a lesson and comply with business regulations and pay taxes in accordance with the law. She has been widely condemned online. One online observer said: 'Justice served! She should go to jail!' While another said: 'These are China's sugar baby training groups, targeting rich men. Ordinary people think 200,000 yuan (US$28,000) is a lot, but for the rich, even casual dating costs hundreds of thousands. 'That is not even counting the cost of having a child. There are way too many women like her, which only proves how many rich men are out there.'
South China Morning Post
07-04-2025
- Business
- South China Morning Post
China love guru who teaches women how to marry rich, faces US$1 million tax evasion fine
A controversial Chinese 'love guru' who teaches women how to marry wealthy men and reportedly earns 142 million yuan (US$20 million) a year is facing a 7.58 million yuan (US$1.1 million) fine for tax evasion. Advertisement The scandal surrounding the guru, who is known as Ququ Big Woman, was recently revealed by China's State Taxation Administration. The case of the internet celebrity, whose real name is Le Chuanqu, was one of five announced by the authorities, and it has attracted the most attention. Le is one of China's most controversial internet celebrities and reportedly earns 142 million yuan a year dishing out dating and financial advice. She went from being a singer to becoming a self-proclaimed 'McKinsey of relationships', promoting the idea that relationships and marriage should be used as strategic tools for climbing the social and financial ladder. Le Chuanqu reportedly earns millions of yuan a year dishing out dating and financial advice. Photo: In August 2023, live-streaming clips featuring her controversial views on dating and relationships went viral.
South China Morning Post
06-02-2025
- Business
- South China Morning Post
China's Lunar New Year spending spree offers hope for consumption boost
Official statistics show China's domestic consumption was robust during the recently concluded Lunar New Year holiday, providing some positive signs for the country's economy as household spending becomes a greater priority in the absence of a more favourable environment for exports. Consumer-related industries posted a 10.8 per cent increase in their average daily sales revenue during the eight-day holiday period compared to last year, official news agency Xinhua reported, citing data from the State Taxation Administration. Spending on consumer goods and services during the annual holiday – which ended on Tuesday – rose 9.9 per cent and 12.3 per cent year-on-year, respectively, based on the administration's value-added tax invoice data. A nationwide trade-in policy for equipment and consumer goods, rolled out last March and still in effect, also appeared to have an impact. Sales of household audiovisual equipment surged 226.8 per cent year-on-year, fuelled by consumption subsidies. 'China's Spring Festival consumption data showed strong growth, driven by a surge in long-distance travel from the extended holiday period and front-loaded demand spurred by Beijing's 'trade-in' policy,' Changjiang Securities wrote in a note on Wednesday. Consumers had been cutting back on spending after drops in asset values and slumps in the property and stock markets, with a 3.5 per cent year-on-year rise in retail sales reported last year – well below the pre-pandemic rate of 8 to 9 per cent. China's tourism revenue climbed 7 per cent year-on-year to a record US$94.2 billion during the holiday, while domestic trips rose 5.9 per cent to 501 million, both all-time highs according to data released Wednesday by the Ministry of Culture and Tourism.
