On August 31, 2018, the 5th session of the 13th National People Congress voted for the 7th amendment of IIT (Individual Income Tax) law. The new tax reform includes the following adjustments: 1) the tightening of judging criteria for individuals without residence; 2) setting up a comprehensive and classified tax system, and optimizing tax rate structure; 3) establishing an integrated system of pre-tax deductions; 4) introducing a TIN (Taxpayer Identification Number) and improving the mechanism of self-reporting as well as reporting of withholding tax.  

The current nationally unified tax system has led to an implicit regional inequality. A large number of migrant workers in China without local hukou are obliged to pay higher IIT than migrant workers in other regions, but they cannot enjoy the same social security benefits as local residents.

However, Shimeng Liu notes, this new reform has started to consider different living costs across regions, therefore, it is a good start that will gradually bring about regional equality.  

Original link：https://www.thepaper.cn/newsDetail_forward_3036116