The National People's Congress (NPC)
has made a significant adjustment to its lawmaking timetable by
fast-tracking debate on the corporate tax law. Meanwhile,
legislators will take more time to study the draft law on property
rights.
The announcement on the two key pieces of legislation was made
by a senior official of the NPC Standing Committee yesterday in
Beijing, four days before the opening of the national legislature's
annual session.
The focus of the amendment to the Corporate Income Tax Law is to
bring parity to taxes paid by domestic and foreign companies. The
property law is to define the protection of citizens' private
property.
The official, from the Legislative Affairs Commission of the NPC
Standing Committee, said the corporate income tax law will unify
income tax rates for all companies in China so as to "promote equal
competition".
Domestic companies have long complained that they are
disadvantaged by preferential tax policies for foreign companies.
Foreign companies enjoy a preferential tax rate of 15 percent
compared to 33 percent for domestic firms.
The draft law on property rights which has been reviewed four
times by the NPC Standing Committee was scheduled to have been
submitted for voting this year.
But it has been taken off the agenda due to "different opinions
and differences on the understanding of certain issues," the
official said.
Legislators usually review a draft law twice or three times
before passing it.
Lawmakers want further studies on the draft law of property
rights, the official said, adding that his commission will conduct
more research to ensure that it "reflects China's fundamental
socialist economic system."
In August last year, a law professor from the prestigious Peking
University wrote an open letter saying that the proposed
legislation seemed to be in conflict with the principle that public
ownership should dominate China's economic system. His letter is
widely believed to be a catalyst for the change in the law-making
plan.
The official also said that the new law should "uphold the basic
interests of farmers" and "reflect the principle of giving equal
protection to State, collective and private properties."
In addition, further studies are needed into the conflict of
property rights and creditors' rights and related technical
details, he noted.
He also said that more effort would be made this year to make
the legislation process more democratic.
For example, legislators will be seeking public opinion on the
law on labor contracts because it "involves the personal interests
of millions of people".
(China Daily March 2, 2006)