Expanding tax reforms to fuel GBA’s market integration
- The E-Tax platform allows Hong Kong and Macau residents to automatically compute and process complex matters, while self-service kiosks provide more than 200 cross-border services, writes Liu Lingzhi, Zeng Meiling and Yue Ruixuan
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Since the introduction of the Outline Development Plan for the Greater Bay Area (GBA) five years ago, the Guangdong Provincial Tax Service has formulated 35 measures and an innovative mechanism to support the free-trade zone in expanding tax reforms. So far, 27 measures have been implemented in the Guangdong Free Trade Zone.
Promoting talent flow with preferential tax policies
According to Macau resident Chen Cailing, Hengqin’s preferential policy reduces his personal income tax by more than 80,000 yuan a year. “The tax burden is basically the same as that in Macau. This addresses the concerns of most Macau people who want to get a job in Hengqin,” said Chen.
To ensure that taxpayers enjoy the policy dividends, the Hengqin tax department, through text messages and other means, notifies people who qualify and their companies of the relevant information to apply for benefits.
Zhu Yaozong, senior leasing manager of Zhuhai Hengqin Laisun Creative Culture City Co., Ltd, said the preferential policies can reduce personal income tax by more than 1.7 million yuan a year for the company’s talent.
For Hong Kong and Macau residents working in Nansha, Guangzhou, the portion of their personal income tax burden that exceeds the Hong Kong and Macau tax burden will also be exempted, according to the Nansha Plan.
Chen Jiahua, senior deputy general manager of Guangdong Enpro Supply Chain Management Ltd., has been working in Nansha for six years. Last year, he was the first to enjoy the preferential personal income tax policy of the plan, saying: “The whole declaration process is very convenient, especially with the personal tax calculation system for Hong Kong and Macau residents, which frees us from the trouble of tedious manual calculations. It only takes two minutes to input information, and the tax exemption data can be automatically generated.”
The tax department has launched a special mechanism for Hong Kong and Macau residents to align mainland personal income tax with Hong Kong’s salaries and profits tax, and Macau’s professional and income supplementary tax.
On the E-Tax platform, the Guangdong tax bureau has also added a module that enables Hong Kong and Macau residents to automatically compute and process complex matters, like the conversion of tax rules between Hong Kong, Macau and the mainland, and calculate tax.
These policies have contributed to the smooth flow of talent, capital and other factors within the GBA. Since the release of the “Overall Development Plan for the Guangdong-Macau In-Depth Cooperation Zone in Hengqin” and the Nansha Plan, more than 10 tax regulations have been successfully integrated with Hong Kong and Macau, effectively benefiting people from these two areas who live and work in Hengqin and Nansha.
Convenient cross-border public services
Many positive explorations are emerging in the market integration development of the GBA, including cross-border public services.
The Cross-border RMB Electronic Tax Payment is an innovative application that allows non-resident taxpayers with overseas UnionPay credit cards to easily pay taxes from anywhere in the world. They can pay online with UnionPay or make mobile payment with UnionPay Mobile QuickPass. The entire process, which takes only a few minutes, is convenient and safe.
A Macau resident with the surname Yang, covered by the social security net in Zhuhai, recently paid his monthly social insurance premium of over 900 yuan online with an overseas UnionPay credit card, from his home in Macau. He said there was no longer any need for him to travel all the way from Macau to Zhuhai to make the payment every month. As at the end of 2023, Hengqin had achieved over 140 million yuan in such cross-border payments.
As cooperation deepens, new cross-border tax service channels are also being developed. “Now, no matter whether I am in Hengqin or Macau, I can handle the common tax services of both companies at the same time, which is time-saving and effortless,” said Gan Yanxia, a Macau resident, who runs a company in Macau and another in Hengqin.
This is made possible with the self-service kiosks launched by the Guangdong Provincial Tax Service, and Guangdong Provincial Government Services and Data Management Bureau in Macau’s Financial Services Bureau. It provides Hong Kong and Macau enterprises and residents with more than 200 services, such as human resources, social security, medical insurance and others. It also enables cross-border self-service processing of high-frequency tax business.
In 10 cities, including Guangzhou, Shenzhen, Zhuhai and Huizhou, the GBA tax handling service is also in full swing. It can handle the first batch of 57 items in five categories, including information inquiry, certification and social security insurance.
The implementation of preferential tax policies and continuous improvement of the quality and efficiency of tax services have promoted the deepening of market integration in the GBA and increased the sense of fulfilment of the population. The Guangdong Provincial Tax Service will further focus on GBA’s new positioning of “one point, two places” and continue to promote the high-quality development of the region in terms of tax service.
