What benefits will be released? One article to understand ->Important policies were intensively introduced in August

On the first day of September, policies continued to be implemented.

On September 1st, the People's Bank of China announced that starting from September 15th, the reserve requirement ratio for foreign exchange deposits will be lowered from the current 6% to 4%.

On July 24th, the Political Bureau of the Central Committee of the Communist Party of China held a meeting to analyze and study the current economic situation and deploy economic work for the second half of the year. The meeting pointed out that the current economic operation is facing new difficulties and challenges, mainly due to insufficient domestic demand, operational difficulties for some enterprises, multiple risks and hidden dangers in key areas, and a complex and severe external environment. The meeting further demands that we make good use of policy space, identify the direction of our efforts, and solidly promote high-quality economic development.

After the Politburo meeting of the Central Committee of the Communist Party of China set the tone, in August, the State Council and various departments issued multiple important policies to continuously promote the continuous improvement of economic operation, continuously releasing positive effects.

01

Personal income tax incentives

In August, three major preferential policies were released in terms of personal income tax to promote the increase of resident income.

One is to increase the special additional deduction standards for personal income tax, including the care of infants and young children under the age of 3, children's education, and supporting the elderly.

The improvement of these special additional deduction standards, focusing on "one elderly and one young", is conducive to further reducing the burden of family support, better safeguarding and improving people's livelihoods, and also helps to increase residents' willingness and ability to consume.

Secondly, the year-end bonus personal income tax preferential policy will continue to be implemented until the end of 2027.

Individual residents who receive a one-time bonus for the whole year, if it meets the regulations, will not be included in the comprehensive income for the current year. The amount obtained by dividing the annual one-time bonus income by 12 months will be determined according to the monthly converted comprehensive income tax rate table attached in the announcement, and the applicable tax rate and quick calculation deduction amount will be calculated separately for tax payment.

Thirdly, residents who meet the relevant conditions are exempt from handling the comprehensive income settlement and payment of personal income tax.

From January 1, 2024 to December 31, 2027, if the annual comprehensive income obtained by individual residents does not exceed 120000 yuan and requires settlement and payment of supplementary tax, or if the annual settlement and payment of supplementary tax does not exceed 400 yuan, individual residents are exempt from handling the settlement and payment of comprehensive personal income tax.

With the more scientific and reasonable personal income tax system, people's wallets will become fuller, their consumption confidence will be stronger, and their sense of gain will also be stronger.

02

New housing policies

The Political Bureau meeting of the Central Committee of the Communist Party of China pointed out that it is necessary to adapt to the new situation of significant changes in the supply and demand relationship of China's real estate market, and adjust and optimize real estate policies in a timely manner. In August, multiple policies were released regarding affordable housing, housing credit, and public rental housing.

Reduce the down payment ratio. For residential families who take out loans to purchase commercial housing, the minimum down payment ratio for commercial personal housing loans for their first home is uniformly not less than 20%, and the minimum down payment ratio for commercial personal housing loans for their second home is uniformly not less than 30%.

Reduce the interest rate on existing housing loans. Starting from September 25, 2023, borrowers of commercial personal housing loans for their first existing housing can apply to the lending financial institution to issue new loans to replace the commercial personal housing loans for their first existing housing. The interest rate level for newly issued loans is determined through independent negotiation between financial institutions and borrowers.

Implement the principle of "housing recognition without loan recognition". When a resident family applies for a loan to purchase commercial housing, if their family members do not have a complete set of housing under the local name, regardless of whether they have used the loan to purchase housing, banking and financial institutions will implement housing credit policies for the first set of housing. This policy, as a policy tool, is included in the "One City, One Policy" toolbox for cities to choose independently. On September 1st, Beijing and Shanghai announced the implementation of the policy measures of "housing recognition without loan recognition".

Individual income tax incentives for residents purchasing housing. From January 1, 2024 to December 31, 2025, taxpayers who sell their own homes and purchase new homes in the market within one year after the sale of their current homes will be eligible for a tax refund on the personal income tax already paid on the sale of their current homes.

Tax incentives for public rental housing. For urban housing security families who meet the conditions stipulated by the local government and receive housing rental subsidies from the local government, they are exempt from personal income tax. Exemption from property tax on public rental housing. The rental income obtained from operating public rental housing is exempt from value-added tax.

Although various policies target different groups, their purpose is to reduce housing costs and better meet the demand for rigid and improved housing.

03

Beneficial for private economy, small and micro enterprises, and individual businesses

The Political Bureau meeting of the Central Committee of the Communist Party of China emphasized the need to effectively optimize the development environment for private enterprises. In order to promote the development and growth of the private economy, the National Development and Reform Commission, the State Administration for Market Regulation, the State Administration of Taxation and other departments jointly issued the Notice on Implementing Several Recent Measures to Promote the Development of the Private Economy, proposing 28 specific measures in five aspects: promoting fair access, strengthening factor support, strengthening legal protection, optimizing enterprise services, and creating a good atmosphere.

The "Several Measures" further strengthen the main responsibility, clarify "who will do it", and make private enterprises understand who to turn to when encountering problems.

At the same time, the "Several Measures" focus on four situations that enterprises strongly reflect, and verify whether there are any illegal or irregular situations in the bidding process. Implementing classified policies to promote the reform of enterprise deregistration. We will establish an interview and notification system for addressing issues of improper intervention in the construction of a unified national market and typical cases. Focusing on the demands and concerns of business entities, targeted policy measures to optimize the business environment will be launched in batches and stages.

While promoting the development and growth of the private economy, a series of tax and fee reduction policies have been continued and optimized for small and micro enterprises, individual businesses, and entrepreneurs.

On the basis of optimizing and increasing support, four phased policies, including individual income tax incentives for individual business owners, reduction of "six taxes and two fees" for small-scale taxpayers, small and micro profit enterprises, and individual business owners, tax incentives for key groups in entrepreneurship and employment, and tax incentives for self-employed retired soldiers in entrepreneurship and employment, will be uniformly implemented until the end of 2027.

Six phased policies, including the reduction and exemption of value-added tax for small-scale taxpayers, tax incentives for interest income from small loans by financial institutions, tax incentives for providing financing guarantees for small and micro enterprises and other groups, tax incentives for signing loan contracts between financial institutions and small and micro enterprises, income tax incentives for small and micro profit enterprises, and tax incentives for start-up investment enterprises and angel investment individuals, will continue to be implemented until the end of 2027.

04

Boosting investment confidence

To activate the capital market and boost investor confidence, a series of preferential policies have been introduced one after another.

Starting from August 28, 2023, the stamp duty on securities trading will be reduced by half.

The China Securities Regulatory Commission fully considers the current market situation, improves the countercyclical adjustment mechanism of the primary and secondary markets, and makes arrangements around a reasonable grasp of the pace of IPO and refinancing. Fully consider market concerns, carefully study and evaluate the share reduction system, and make requirements for further regulating the reduction behavior of relevant parties.

At the same time, multiple tax and fee preferential policies have been introduced to support the healthy development of the capital market. Including providing personal income tax benefits to individual investors who transfer or hold innovative enterprise depositary receipts; The income obtained by overseas individual investors from investing in futures products of crude oil and other goods within China approved by the State Council for opening to the outside world is temporarily exempt from personal income tax; Personal income tax will continue to be temporarily exempted for mainland individual investors who receive transfer price differences from investing in stocks listed on the Hong Kong Stock Exchange through the Shanghai Hong Kong Stock Connect and the Shenzhen Hong Kong Stock Connect, as well as transfer price differences from buying and selling Hong Kong fund shares through mutual fund recognition.

At the same time, in terms of attracting foreign investment, the State Council has issued the "Opinions on Further Optimizing the Foreign Investment Environment and Increasing the Strength of Attracting Foreign Investment".

The Opinion proposes 24 policy measures in 6 aspects, including improving the quality of foreign investment utilization, ensuring the national treatment of foreign-invested enterprises, continuously strengthening the protection of foreign investment, improving the level of investment and operation convenience, increasing financial and tax support, and improving the promotion methods of foreign investment. It aims to create a market-oriented, legal, and internationalized first-class business environment, and attract and utilize foreign investment more effectively and effectively.

A series of policies have been intensively introduced, which will effectively consolidate the foundation and cultivate the economy, continuously promote the continuous improvement of economic operation, the continuous enhancement of endogenous driving force, the continuous improvement of social expectations, and the continuous resolution of risks and hidden dangers, and promote the effective improvement of quality and reasonable growth of quantity in the economy.