The tax collection is being carried out in the withholding method. Will there be any difficulties if securities companies are all overloaded as currently seen?

Currently, we are collecting tax in the withholding method as stipulated in the Ordinance on High Income Earner Taxation. Once the personal income tax is imposed on earnings from securities investment, the subjects of the taxation will be larger.

The personal income tax bill suggests the tax rate on capital assignment at 25%. We plan to collect taxes this way: when investors transfer their shares, securities companies will withhold 0.1% of the total value of the assigned shares. At the year end, the earners have to come to taxation agencies to declare the total income and the total tax they have to pay. If the tax sums they have to pay are higher than the sums they pay money sums. Meanwhile, if the tax sums they have to pay are lower than the temporarily paid sums, they will get the tax refund.

Regarding the technical issues, I believe that with the current technologies, it would not be so difficult for securities companies to withhold taxes from investors.

The transactions on the OTC market prove to be very complicated. How would you carry out the tax collection to ensure fairness and efficiency?

You may know that public companies will have to make registrations, and in some more time, the companies that want to have their shares traded will have to deposit securities, while investors on OTC market will also have to open accounts at securities companies. By that time, securities transactions will be put under control, which will meet the requirements for the tax collection by withholding method.

If the government taxes the earnings from securities investment, there will be more tax payers. How can the General Department of Taxation get adapted in terms of staff to the tax collection?

We have foreseen the issue and we will have detailed solutions to the problem.

People still argue about the taxation on the earnings from securities investment. Some experts said that the earnings from securities investment would be taxed twice, by the corporate income tax and personal income tax. What would you say about this?

If one makes investments in a legal entity, and the legal entity makes profit, the state will tax on this profit. When the investor gets profit from the legal entity, that means he has personal income, and the income must be taxed. The corporate income tax and personal income tax are quire different, and this must not be considered as the overlapping in taxation.