Article　6. The amount of each category of taxable income shall be computed as follows.
　      1. For　incomes　from wages and salaries, a standard allowance of RMB 800 shall be given for a person and amount in excess of the allowance shall be taxable.
2. Incomes derived by individual households engaging in industry and commerce from their pro--duction and business operations shall be taxed at he gross amount in a tax year after deducting costs,
expenses　and losses.

3. Incomes　derived by enterprises and institutions from contracting or leasing operations shall be taxed at the gross amount in　a　tax year after deducting expenses.
4. Incomes from remuneration for personal services,　remuneration to authors, royalties and leasing of property shall be taxed at the part in excess of RMB 800 if the monthly income does not exceed RMB 4,000 or at　the part after deducting 20% as expenses if the monthly income　exceeds RMB 4,000.
5. Incomes from transfer of property shall be taxed at the amount after deducting　the original value of　the　property and reasonable expenses.
6. Incomes from interests , dividends　and extra dividends shall be taxed at the full amount of each  payment. The　part of donations by individuals to education　and　other public　undertakings shall be deducted from the taxable income according to　the relevant regulations by the State Council .Add--itional　 expenses shall be deducted for taxpayers  who have no residence in the territory of China but derive income from wages and salaries obtained in China and for taxpayers who have residences in China but derive income from wages and salaries obtained outside the territory of China according to their average income levels, living levels and changes of exchange rates. The scope and standards of　the deduction shall be formulated by the State Council separately.
　

Article  7. The amount of individual income tax paid by taxpayers who derive income outside the territory of China may be deducted from their　taxable　income, but the amount of deduction shall not exceed the taxable amount of the income from outside the　territory of China computed according to the provisions of this law.
　

Article　8.　For　individual income tax, the income earner shall be the taxpayer and the paying unit  or persons shall be the withholding agent. Taxpayers who derive income from wages and salaries from two or more units and/or without a withholding agent are required to file　tax returns and pay taxes themselves.
　Article　9.　The　tax withheld each month by a withholding agent and the tax to be paid each mouth by a taxpayer personally filing a returns must　be paid  to  the  State  treasury  with the tax returns being submitted　to　the　tax　authorities within the  first  seven  days  of  the  following month. 　The taxable　wage　and salary shall be taxed on the monthly basis and the tax  amount payable shall be submitted to the State treasury　by the withholding agent or taxpayer personally with the tax returns being submitted to the tax authorities within the first seven days of the following month. The tax amount payable from wages and salaries from certain special trade may be computed on an annual basis and paid in advance in monthly stallments. The specific methods of computation and collection shall be worked out separately by the State Council.
　The tax amount payable  on  income derived from production and business operations by  individual  households engaging in industry and commerce shall be computed on an annual basis and paid in advance in monthly installments by withholding agents within the first seven days of  the  following month and final settlement shall be made within three months from the end of the  tax year,  with a refund for any  overpayment or a supplemental payment for any deficiency.
　 The tax amount payable on income derived by enterprises and institutions from contracting or leasing  operations shall be computed on annual basis and paid and turned over to the State treasury by withholding  agents with tax returns being submitted to the tax authorities within 30 days after the end of a tax year. If  the taxpayers derive income from contracting or leasing operations by installments, the tax amount payable  shall be paid in advance within seven days after each payment is obtained and final settlement shall be made within three months after a tax year, with a refund for any overpayment or a supplemental payment for any  deficiency.
　Taxpayers who earn  incomes  from outside the territory of  China must pay the taxes  due  to  the  State treasury and submit the tax returns　to the tax authorities within 30 days after the end of each year.
　

Article　10. All categories of income shall be computed in terms of Renminbi. Income in foreign currency  Shall Be taxed on the equivalent　amount converted into Renminbi　according to the foreign exchange rate quoted by the State Administration of Exchange Control of the　People's Republic of China.
　

Article　11. A service fee of 2% of the amount of the tax withheld shall be paid to the withholding agents.
　

Article　12. The collection and management of individual  income tax shall  follow the provisions of the "Provisions of the People's Republic of China on the Collection and Management of Taxes".
　

Article　13. Rules for the　implementation of this law shall be formulated by the State Council.
   Article  14. The law shall be enforced as of the date of promulgation.

Table 1 Individual Income Tax Rates (Applicable to income form wages and salaries)

Grade Monthly Taxable Income　　　　　　　　         　 Rate (%)
1  Not in excess RMB 500　　　　　　　　　　　         　  5
2  In excess of RMB 500 up to RMB2,000　　　　　          　 10
3　In excess of RMB 2,000 up to RMB5,000　　 　　　　  15
4  In excess of RMB 5,000 up to RMB20,000 　　　　　　　 20
5　In excess of RMB 20,000 up to RMB40,000　 　　　 　 10
6　In excess of RMB 40,000 up to RMB 60,000　　  　　　　30
7　In excess of RMB 60.000 up to RMB 80,000　　　　　　 35
8　In excess of RMB 80,000 up to RMB 100,000　　　　　　40
9　In excess of RMB 100,000　　　　　　          　　　　　45

　(Note: The monthly　taxable income refers to the amount in excess the　standard allowance of expenses Of RMB 800 or additional expenses according to the provisions of Article 6 of this law.)

Table 2 Individual Income Tax Rates ( Applicable to income derived by individual households engaging in Industry and commerce from their production or business operations and income derived by enterprises or

institutions  from their contracting or leasing operations)
Grade Annual Taxable Income　　　　　　　　　　　　　　Rate (%)
1  Not in excess of RMB 5,000　　　　　　　       　　　         5
2  In excess of RMB 5,000 up to RMB10,000　 　　 　　　     10
3　In excess of RMB 10,000 up to RMB 30,000　　  　　　　 15
4  In excess of RMB 30,000 up to RMB 50,000　　　　　　　 20
5　In excess of RMB     　　　　　　　　　　　　 　　       35

(Note: The annual taxable income refers to the gross income of a tax year after deducting costs, expenses

and losses according to provisions of Article 6 of this law. )