Zhu Yanyan/Shanghai Daily news

China's lawmakers are considering a plan to nearly double the threshold for taxable income, a standard that hasn't changed in more than 10 years despite an economic boom that's generated a marked increase in wages and consumer prices.
A proposal now under review in Beijing would raise the monthly tax floor from the present 800 yuan (US$98.76) to 1,500 yuan.
The reform package is being discussed at a three-day session of the Standing Committee of the National People's Congress, which began yesterday.
Chinese finance Minister Jin Renqing said the existing monthly tax minimum was set in 1993 when only 1 percent of wage earners had salaries of more than 800 yuan.
Today that figure is above 50 percent as China's economy has expanded and personal incomes improved, Jin said.
"The salary below the threshold allows an individual to pay his or her basic needs such as food, housing and education," said Bai Jingming, a researcher at a think tank under China's Ministry of Finance. "But consumer prices have risen rapidly over the past years. Spending on housing, health care and education has grown even faster than in other areas."
Bai said raising the tax threshold will ease the burden on low- and medium-income families and encourage consumer spending.
Consumer prices more than tripled from 1985 to 2004.
An early version of the tax reform proposed an increase to 1,200 yuan, allowing affluent cities to raise the threshold further based on their own needs, according to the China Business News, a Shanghai-based financial daily.
The earlier plan was scrapped because of a desire for a standard level, the paper said, quoting an expert involved in the drafting process.
"Putting the tax floor at 1,500 yuan allows for some stability," said Bai. "As wages expand at double-digit rates annually, the starting line might need amendment soon if it was set at 1,200 yuan."
China's average annual wage, including salaries paid by state-owned firms, private companies and overseas-invested outfits, stood at 16,000 yuan in 2004.
It was higher in major cities like Shanghai, where the annual average was 30,000 yuan, and lower in provinces such as eastern China's Shandong, where the average was 14,000.
China's individual income tax law was introduced in 1980.
Taxes are levied on monthly wages exceeding the threshold. The amount is calibrated over a nine-grade range that ascends from 5 percent to 45 percent.
Extra income from work, manuscripts, interest and dividends is taxed at 20 percent.
Previous media reports indicated lawmakers were also considering a reform plan based on 11 categories of income types, but the package apparently will not come before the Standing Committee at this session.
China collected 173.7 billion yuan worth of personal income tax last year, up from 41.4 billion yuan in 1999. The amount represented 6.7 percent of the country's total tax revenue in 2004, compared with 4 percent in 1999, according to the State Administration of Taxation.