From March 1 to June 30, 2020, tens of millions of individual taxpayers in China independently completed the online or offline annual individual income tax settlement for the first time, which means the new individual income tax law, implemented in 2019, has been successfully introduced. The annual individual income tax settlement is a system that guarantees the fairness of individual income tax and allows taxpayers to calculate and pay undeclared tax or get tax refunds on the basis of prepaid taxes. 

Taxation is an important part of the country's economic system, and modernizing and managing the taxation system is an inherent requirement for modernizing China's governance capacity. Despite the complexity of individual income tax collection and the difficulties caused by the coronavirus pandemic, the first annual individual income tax settlement was completed successfully, which shows the strong tax governance capabilities of China in five areas. 

The system advantage of national taxation governance 

Management of individual income tax, which involves tax collection and payment, is relatively complicated. Different from the complicated tax system in developed countries, China simplified the individual income tax system based on objective realities. In addition to the annual basic deduction of 60,000 yuan ($8,571), six other qualified deductions in the new individual income tax law are related to the actual living expenditure needs of taxpayers, and adopt a fixed non-proportional standard, which is not only easy for taxpayers to understand but also convenient for effective implementation.