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Q: Why do local people try to avoid paying tax?
I have come across this time and time again.
I know a 28 year old woman who complained about tax. I asked her how much tax she had paid... 200rmb was the answer. And she complained about it. She had only paid 200rmb direct tax after almost a decade of working.
Does paying tax make someone lose face? I can't figure it out. Can you?
Because they get nothing for it.
coineineagh:
it may be a chicken and the egg scenario, in that citizens are perpetually unhappy no matter how much public service they receive from their taxes. so the government is better off giving nothing in return, as it isn't appreciated. the people are a product of the government is a product of the people.
ScotsAlan:
Yup. Locals have said this to me. I have often shown them the "What have to Romans ever done for us ?" sketch.
It's more than just the tax, they get deducted for health insurance, forced housing loan money that can be used for buying a cheap apartment, so if that girl was making Y3000 a month she'd be taking home Y2100 after all is said and done.. So avoiding tax might be the only way to save a dime.. And a dime buys them a lot..
Because they get nothing for it.
coineineagh:
it may be a chicken and the egg scenario, in that citizens are perpetually unhappy no matter how much public service they receive from their taxes. so the government is better off giving nothing in return, as it isn't appreciated. the people are a product of the government is a product of the people.
ScotsAlan:
Yup. Locals have said this to me. I have often shown them the "What have to Romans ever done for us ?" sketch.
Better save the money your self, and use on what you need when the time comes rather for it to go to the pocket of some corrupt Wang in the system.
It will be a problem. All sizeable countries which do not collect tax properly, eventually fail. I lived in Greece for a short time, doctors, pharmacists, nobodypaid tax.
It's a corporate problem. I had a Chinese friend who had to go back to her hometown, but couldn't, because her company required her to pick up half her salary at the company the next week. Her company pays half the salary by bank transfer and half the salary by cash pickup. So on the books she only makes half her salary so her company doesn't have to pay more tax for her. If the companies cheat the tax system, why should the individual comply?
ScotsAlan:
I wonder how the company can hide that on it's books? They must be audited surely.
Same reason why anybody doesn't want to pay tax. Selfishness mixed with a belief (true or not) that the system is corrupt anyway.
Pursuit of self interest above collective goals, maximizing ones financial benefit without regards to the public good cause in China there's little reason to trust the government anyway.... But above all else they cheat because they can. It's an enforcement problem. Once the laws are properly enforced people will obey them.
It's the reason that they always look for illegal foreign workers because they don't want the govt to monitor their business income and tax it.
I know some who always find new ways to avoid paying taxes, then complain that the government is not doing this and that as it should. And where does the government get the funds to pay public workers, build infrastructures or fix things? From the taxes that a number of Chinese dodge without a second thought.
If you dodge taxes, the minimum decency means you do not complain about government efficiency.
In a country with SOEs why should anybody pay tax? How can a government that owns industries that return a profit ever need to tax people?
make fake bills and house rent cards to show much more expenses thn they actually have
