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igorG
Joined: 10 Aug 2010
Posts: 1473
Location: asia
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 Posted: Wed Mar 28, 2012 3:08 pm Post subject: |
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Well, one evidence may be that FTs' current tax slips are fraudulant. Think how much more another 11% may further encourage the already dishonest employers.
| auchtermuchty wrote: |
| shadowrider wrote: |
Evidence? several of us here are having these bloody taxes stolen from us every month as it is as reported in this forum and elsewhere like shanghai expat.
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No-one is saying these taxes will not be collected. IgorG says foreigners will have to pay a different, higher rate of social taxes than locals. This is not true. |
So, are you saying the locals' social taxes are and will be comparable? Do you really believe that locals pay 11% social tax?
I know that reading this below you have wet your pants before but for the sake of the argument let me try to remind you here again
| Quote: |
Foreign worker 7,000 with 15% of 2,200 + 11% of 7,000
Chinese worker 7,000 with 15% of 3,500
Foreign worker 12,000 with 20% of 7,200 + 11% of 12,000
Chinese worker 12,000 with 20% of 8,500
Mind the taxable income for locals from 3,500 and foreigners from 4,800. |
Like i have said the taxes will not be much different although they have been unequivalent and that's one of the reasons FTs have been coming to work in this country. |
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wangdaning
Joined: 22 Jan 2008
Posts: 3154
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| Posted: Wed Mar 28, 2012 11:35 pm Post subject: |
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| igorG wrote: |
| Well, one evidence may be that FTs' current tax slips are fraudulant. Think how much more another 11% may further encourage the already dishonest employers. |
I get the point here, but that is not really not being able to reclaim what you paid in, that is being robbed by your employer. If they are just pocketing the money then you are not really paying in.
I find it sad that so many people have came to the conclusion (accepted as fact) that they will never be able to reclaim the money. I haven't started paying this tax, not sure if I ever will. Like all things in China this will be a province by province, city by city thing. I am simply unwilling to assume I will not be able to recollect. If there is evidence that repayment is being refused, then I will accept it. Until then, I just don't know. |
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Javelin of Radiance
Joined: 01 Jul 2009
Posts: 1187
Location: The West
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| Posted: Thu Mar 29, 2012 1:32 am Post subject: |
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| Unfortunately jumping to conclusions is what a lot of people here seem to do best. At this point in time there's no evidence to show what's going to happen with regards to reclaiming the money on departure. Personally I think keeping an open mind and not letting the possibility of being ripped off taint your attitude for the rest of your time here is advisable. |
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Lobster
Joined: 20 Jun 2006
Posts: 2040
Location: Somewhere under the Sea
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| Posted: Thu Mar 29, 2012 2:43 am Post subject: |
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In my opinion, until the mechanisms for reclaiming the contributions, accessing medical care and claiming unemployment benefits are in place, they have no business collecting the money. If you are being asked to pay for benefits that they are not providing, it's fraudulent.
RED |
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igorG
Joined: 10 Aug 2010
Posts: 1473
Location: asia
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| Posted: Thu Mar 29, 2012 3:50 am Post subject: |
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| Javelin of Radiance wrote: |
| Unfortunately jumping to conclusions is what a lot of people here seem to do best. |
Fortunately we have someone on forums to tell us that we are the only ones jumping to conclusions.  |
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Simon in Suzhou
Joined: 09 Aug 2011
Posts: 404
Location: GZ
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| Posted: Thu Mar 29, 2012 6:43 am Post subject: |
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Well, when part of the money we are paying in is for unemployment insurance which is an almost IMPOSSIBLE benefit for a foreign employee to take advantage of (no work visa, no staying in China!), and processes haven't been laid out AHEAD of time for pension refunds, yet we are required to pay backtaxes because this law was rushed into place without any thought of actual collection processes...
Forgive us if it looks a helluvalot like a money grab from a convenient source with no voice or power (foreigners) for a pension system that is soon to be on the ropes because China will soon not have the workforce to support the retirees...
I am hopeful it isn't as it appears, but there is not a lot to be optimistic about. |
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auchtermuchty
Joined: 05 Dec 2009
Posts: 344
Location: Beijing
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| Posted: Thu Mar 29, 2012 8:45 am Post subject: |
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| igorG wrote: |
So, are you saying the locals' social taxes are and will be comparable? Do you really believe that locals pay 11% social tax?
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Yes. You still don't understand. Each region sets a rate of contribution for individuals and employers. Chinese and foreigners are liable to pay this rate. All people working for reputable employers will now have to pay this. I'm sure there will be some (foreigner and local) who don't, but they won't be doing so legally (unless there is some bilateral agreement).
| Quote: |
I know that reading this below you have wet your pants before but for the sake of the argument let me try to remind you here again
| Quote: |
Foreign worker 7,000 with 15% of 2,200 + 11% of 7,000
Chinese worker 7,000 with 15% of 3,500
Foreign worker 12,000 with 20% of 7,200 + 11% of 12,000
Chinese worker 12,000 with 20% of 8,500
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The above is completely incorrect. You clearly don't understand how income tax is calculated (it's been explained to death in other threads) and you dishonestly claim that the social taxes for individuals only applies to foreigners. Nearly all the Chinese people I know who are employed, including my wife, pay these taxes. I'm sure there are people working in shops or paid hourly who do not, but they are not the rule in any major city.
Foreigners still pay slightly less income tax than Chinese, but the gap has been narrowing in recent years. |
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shadowrider
Joined: 05 Feb 2012
Posts: 208
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| Posted: Thu Mar 29, 2012 12:09 pm Post subject: |
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| Lobster wrote: |
In my opinion, until the mechanisms for reclaiming the contributions, accessing medical care and claiming unemployment benefits are in place, they have no business collecting the money. If you are being asked to pay for benefits that they are not providing, it's fraudulent.
RED |
Agreed. If there was a guarantee we get our contributions back, I don't have a problem with it. I think its an ill-gotten cash grab, in line with Hu's anti-foriegner drive. "China has arrived, we don't need you foreigners anymore" |
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igorG
Joined: 10 Aug 2010
Posts: 1473
Location: asia
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| Posted: Thu Mar 29, 2012 5:00 pm Post subject: |
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| auchtermuchty wrote: |
| igorG wrote: |
So, are you saying the locals' social taxes are and will be comparable? Do you really believe that locals pay 11% social tax?
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Yes. You still don't understand. Each region sets a rate of contribution for individuals and employers. Chinese and foreigners are liable to pay this rate. All people working for reputable employers will now have to pay this. I'm sure there will be some (foreigner and local) who don't, but they won't be doing so legally (unless there is some bilateral agreement).
| Quote: |
I know that reading this below you have wet your pants before but for the sake of the argument let me try to remind you here again
| Quote: |
Foreign worker 7,000 with 15% of 2,200 + 11% of 7,000
Chinese worker 7,000 with 15% of 3,500
Foreign worker 12,000 with 20% of 7,200 + 11% of 12,000
Chinese worker 12,000 with 20% of 8,500
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The above is completely incorrect. You clearly don't understand how income tax is calculated (it's been explained to death in other threads) and you dishonestly claim that the social taxes for individuals only applies to foreigners. Nearly all the Chinese people I know who are employed, including my wife, pay these taxes. I'm sure there are people working in shops or paid hourly who do not, but they are not the rule in any major city.
Foreigners still pay slightly less income tax than Chinese, but the gap has been narrowing in recent years. |
No, I still don't understand. Why don't you demonstrate some accounting skills which could smoother make us all comprehend the local taxation system as well as the so helpful social tax. Sorry that I am so incorrect. |
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auchtermuchty
Joined: 05 Dec 2009
Posts: 344
Location: Beijing
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| Posted: Thu Mar 29, 2012 10:57 pm Post subject: |
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| igorG wrote: |
No, I still don't understand. Why don't you demonstrate some accounting skills which could smoother make us all comprehend the local taxation system as well as the so helpful social tax. Sorry that I am so incorrect. |
The tax free allowance is 4800 for foreigners and 3500 for locals. So, a foreigner on 7000 RMB a month has a taxable income of 2200 RMB. The Chinese person on the same salary has a taxable income of 3500 RMB. (You were actually correct on this bit)
Both pay 3% on the first 1500 of taxable income, and then 10% on the next 3000 RMB (i.e. the bit from 1500 to 4500). That means the foreigner pays 115 RMB in tax and the Chinese person pays 245 RMB.
A marginal rate of 20% is applied on the taxable income from 4500 to 9000, so the foreigner on 12,000 a month would pay 885 RMB in tax. The Chinese person would pay 1145 RMB.
The rates were changed on Sep 1, 2011, but your calculation was also wrong under the old rates. |
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shadowrider
Joined: 05 Feb 2012
Posts: 208
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| Posted: Fri Mar 30, 2012 12:07 am Post subject: |
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...and the whole income tax thing really has nothing to do with the new social taxes only a select few FTs in China can avail of (the ones that will retire here).
For a vast number of FTs here, we are basically temporary employees for 1 to x years, and the 11% is a money grab. The retroactive part is that kicker. |
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auchtermuchty
Joined: 05 Dec 2009
Posts: 344
Location: Beijing
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| Posted: Fri Mar 30, 2012 4:23 am Post subject: |
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| shadowrider wrote: |
...and the whole income tax thing really has nothing to do with the new social taxes only a select few FTs in China can avail of (the ones that will retire here).
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Yes, it's irrelevant. I'm sorry for diverting the thread. As to the new social taxes, we surely have to wait and see if it is, as the government claim, possible to get a refund of pension contributions when we leave. I will also be expecting my employer to provide me with a health insurance card if they start deducting the social taxes.
| Quote: |
For a vast number of FTs here, we are basically temporary employees for 1 to x years, and the 11% is a money grab. The retroactive part is that kicker. |
I agree. |
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auchtermuchty
Joined: 05 Dec 2009
Posts: 344
Location: Beijing
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| Posted: Fri Mar 30, 2012 6:05 am Post subject: |
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| One thing that hasn't really been discussed much is the impact it will have on hiring practices. Because of the upper cap on contributions, both for the employee and the employer, it will be cheaper for companies in most parts of China to employ two people on 15,000 than to employ three people on 10,000. We might see a rise in the number of places offering high wages for long hours. You might also see reduced salaries but better apartments/airfare refunds/other benefits. |
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igorG
Joined: 10 Aug 2010
Posts: 1473
Location: asia
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| Posted: Fri Mar 30, 2012 10:16 am Post subject: |
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I hate to be pulling out my quotes but what you are suggesting has been brought up on page 10 of this thread.
| igorG wrote: |
| waxwing wrote: |
| choudoufu wrote: |
| waxwing wrote: |
| Shroob: It's 11% on the first 12000. So it's not like income tax, there's a maximum where it ends, not a minimum where it starts. |
so it takes a relatively big bite out of the pay of the low-level proletariat
types, while the highly-paid upper-cheeses won't even notice it?
ya gotta love communism with chinese characteristics. |
Quite so.
But since foreigners don't have any rights or voice in this country, who cares?
Here's an interesting thought - suppose your salary is 13K or whatever, above the ceiling - every month you are putting in 1K and your employer is putting in 4K. I wonder how much of that 5K per month will ever be put back to you, in terms of retirement/pension (ha ha) or paid back when you leave?
I almost wouldn't mind if I actually thought that money was going to help impoverished kids in Gansu or something. Yeah, right.. |
I've heard Beijing's planning to invest a large sum of tax collection money. So, little will probably get to poor.
Here's another thought - suppose local business people figure out it may be cheaper to pay foreign workers over that 12,500 RMB monthly. |
The 2 FTs for 15,000 monthly each rather than 3 FTs for 10,000 monthly each is a very interesting concept. |
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mike w
Joined: 26 May 2004
Posts: 1071
Location: Beijing building site
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| Posted: Sat Mar 31, 2012 8:30 am Post subject: |
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| Here is a twist to the social tax saga - it only applies to foreigners who are paid in RMB. |
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