 An Introduction to the People's Congress System
The National People's Congress (NPC) is the highest organ of State power and the top body of legislature of China. Its permanent organ is the NPC Standing Committee.
China held people's congresses at different levels in 1953, and in 1954, the First National People's Congress was convened, marking the establishment of the people's congress system.
People's congresses are responsible for creating and supervising all administrative, judicial and procuratorial bodies at every level.
Deputies to county and township people's congresses are directly elected. Deputies to people's congress above the county level are elected by deputies at lower levels. NPC deputies are supervised by delegates at lower levels, and are ultimately responsible to the people who can recall them.
1． Responsibilities of NPC and its Standing Committee
Each NPC term lasts five years. It convenes an annual plenary session, usually in March, to debate important national issues. NPC Standing Committee, elected by NPC members, has full parliamentary power when the NPC is not sitting. The NPC Standing Committee is responsible to the NPC and reports its work to the NPC. The NPC and its Standing Committee exercise State legislative power.
The NPC can amend the Constitution and supervises its enforcement, and formulates and amends basic statutes and other laws. It also decides on and elects the leading personnel of State-level administrative, judicial, procuratorial and military bodies, has the right to recall them, and examines and makes decisions on fundamental, long-term and key issues.
The NPC is empowered to examine and approve the national economic and social development plans and the reports on their implementation.
It is also responsible for examining and approving the State budget and the report on its implementation during its annual meeting.
All administrative, judicial, procuratorial and military organs and other State-level institutions are responsible to the NPC and supervised by it.
2． The Ways to Make Proposals to NPC
The NPC presidium, NPC Standing Committee, special working committees under the NPC, the State Council, the Central Military Commission, the Supreme People's Court and the Supreme People's Procuratorate have the right to make proposals to the NPC. The NPC presidium decides whether to put the proposals on the agenda of a plenary meeting.
An NPC delegation, composed of an election unit, a group of more than 30 NPC deputies, is also able to propose topics for debate to the NPC. The NPC presidium will judge by itself or consult its special working committees to decide whether to put the proposals on the agenda.
If selected for debate, a group of proposers has to explain the motion to the NPC. NPC delegates will debate the proposals and the presidium will make the final decision on whether to put the proposals to a vote.
Highlights of the Fifth Session of the Tenth NPC
Ⅰ Draft Property Law Equally Protects Private, Public Ownership
The decision, made at the 25th session of the NPC's 10th Standing Committee on Dec. 29th, 2006, pushes the marathon legislative process of the controversial property law to the last lap after seven readings. No previous law has had more than five readings.
The property bill had its first reading in 2002 and was withdrawn from the NPC full session in March amid worries that the draft might undermine the legal foundation of the public ownership of the socialist system. If passed in the current sessions of NPC, it will be the country's first law to protect both public and private ownership.
Yao Hong, director of the civil law office under the NPC Law Committee, refuted worries that it would undermine China's socialist market system, claiming the draft is in line with the spirit of China's Constitution.
She said although the Constitution stipulates that public ownership should be the leading force of the socialist market economy, of which the private economy is a major component, it doesn't indicate that the two ownerships should not be equally protected.
"It's obviously unfair if compensation for State-owned property is higher than that for private-owned," Yao said. "It would seriously harm the public's interests."
After discussion, the NPC's 10th Standing Committee agreed that the latest draft, which emphasizes equal protection of State, collective and private property, takes into consideration the concerns of all parties, and decided to submit it to the present NPC full session.
Ⅱ Unifying Corporate Income Tax
Chinese Premier Wen Jiabao said on Mar. 5th, 2007, that the timing and conditions were now ripe for unifying the enterprise income tax rates for domestic and overseas-funded enterprises to the same level.
Wen made the remark while delivering a government work report to the just-opened annual session of NPC, which will deliberate the draft law on equalizing corporate income tax for both domestic and foreign companies.
Jiang Enzhu, spokesman for the annual session of National People's Congress (NPC), said that the unified income tax rate will help foster a fairer, more regulated and transparent taxation system for all kinds of businesses, and improve the quality and standard of China's utilization of foreign investment.
"The law still in draft will neither cause massive influence on foreign companies or affect their enthusiasm of investing in China, " Jiang said.
The bill suggests unified income tax rates for domestic and foreign companies at 25 percent, according to earlier reports.
The lawmaking process, initiated last December, aims to ease years of criticism that the original dual income-tax structure is unfair to domestic enterprises.
The income tax rate for Chinese companies is currently set at 33 percent, while their foreign counterparts, which benefit from tax waivers and incentives, pay an average of 15 percent. However, both actually pay less due to other flexible preferential policies.
Many people believe that such a policy handicaps the growth of domestic businesses which have to face tougher competition since China's accession to the World Trade Organization (WTO) in 2001.
Shi Yaobin, director of the taxation policy department under the Ministry of Finance said that the reform on corporate income tax marks the maturity of China's socialist market economy.
"It does not intend to put restrictions on foreign companies or to counteract their too small tax contributions before. The purpose is to create a fair environment for competition," Shi said.
Experts agree that the tax change is actually a commitment to the WTO for equal treatment to enterprises, which can only strengthen China's responsible role and make it more attractive to foreign investment.
A research report from the World Bank analyzed that stable political situation, sound economic development, broad market, rich labor sources as well as increasingly upgraded business infrastructure and government service in China are the major factors attracting foreign investment.
Tax incentives are usually considered less important than transparent taxation and indiscriminate government policies, said the report.
Meanwhile, the Ministry of Finance has promised it would allow a transitional period to offset the impact on foreign companies.
"The income tax rate will be gradually increased to the 25 percent during that period, and foreign enterprises can still enjoy tax breaks within a regulated time limit," said Shi Yaobin.
The current practice is new foreign investors can be exempted from income tax for two years and get a 50 percent cut for another three years.
Generous tax incentives have fueled foreign capital influx. China has been one of the world's top destinations for foreign direct investment (FDI), taking in 53.5 billion dollars in 2003, 60.6 billion dollars in 2004, and 60.3 billion dollars in 2006 in terms of the amount actually used.
Last year, China reported a record-high tax revenue of 3.76 trillion yuan (482 billion U.S. dollars), excluding tariffs, tax on farmland acquisition and tax on real estate contracts. Foreign-funded companies contributed 153.4 billion yuan (19.7 billion dollars), or four percent of the total.
Experts point out that the 25-percent tax rate is still favorable compared with those in some countries and regions. What's more, they expect the unified corporate income tax exert deeper influence on the country's economic growth patterns.
Preferential tax policies will be shifted to investment in projects concerning environmental protection, water conservation, production safety and high-tech development, according to the draft law. It will also spur local authorities, which often offer various tax incentives to lure investors for usually a reckless GDP growth, to head toward a scientific development mode, experts say.
Ⅲ Hefty Educational Investment
Chinese Premier Wen Jiabao in his government work report of this year announced a hefty educational investment plan of the year, making education a "strategic priority."
A total of 85.85 billion yuan (11 billion U.S. dollars) will be allocated from the central budget this year, an increase of 41.7 percent over the previous year.
"This is another major move we are taking to promote fairness in education following the exemption of all tuition and miscellaneous fees for rural students receiving compulsory education," said the premier.
A system of national scholarships and tuition assistance will go into operation this semester, which starts in early March, for regular undergraduate institutions, vocational colleges and secondary vocational schools.
Funds appropriated for this purpose by the central government will be 9.5 billion yuan (1.22 billion U.S. dollars) this year, and 20 billion yuan (2.56 billion U.S. dollars) next year, and local governments should allocate corresponding amounts from local budgets.
"Education is the bedrock of China's development, and fairness in education is an important form of social fairness. We need to make education a strategic priority and accelerate the development of all types of education at all levels," said Wen.
The country will further implement the state student loan system that was introduced in 1999 in eight major cities including Beijing and Shanghai and was extended to the rest of the country in 2004. In China, some families have to pay 8,000 yuan (976 U.S. dollars) every year to support a college student. Such a figure might be years of income for a farmer.
Another major move highlighted in the government work report is that the country will grant free education for students majoring in education in normal colleges/universities.
"The move is to show respect for teachers and education in society and to produce larger numbers of outstanding teachers," said the premier, adding the new policy is "to encourage prominent educators to run schools and more outstanding young people to become lifelong educators."
Chinese schools, especially rural village schools, lack sufficient and qualified teachers, despite increasing investment from the government. At present, many primary and middle schools are still short of teachers specializing in foreign languages, information technology, music, fine arts and physical education.
Ⅳ ￥391.7 Billion for Agriculture
The central government of China will spend 391.7 billion yuan on agriculture, rural areas and farmers this year, as it vows to develop modern agriculture and promote the building of a new countryside, said Premier Wen Jiabao in a government work report of this year.
"We will effectively shift the focus of state infrastructure development and development of social programs to the countryside," Wen said. The allocations from the central government budget will total 391.7 billion yuan this year, an increase of 52 billion yuan over last year and 94.2 billion yuan over the year of 2005.
Agriculture, as the base of the country's economy, remains weak, and it is now more difficult than ever to steadily increase grain production and keep rural incomes growing, Wen said.
The Study Times, a newspaper affiliated to the Party School of the Central Committee of the Communist Party of China, predicted that China could face a 4.8 million ton grain shortage in 2010, almost 9 percent of the country's grain consumption.
Wen said this year's work related to agriculture, rural areas and farmers will focus on accelerating the development of modern agriculture and effectively promoting the building of a new socialist countryside.
A central government document released late January said developing modern agriculture is the top priority in building a new socialist countryside.
China must strengthen government policy, funding, application of science and technology, and reform to develop modern agriculture and promote the building of a new countryside, the premier said.
The premier announced China will set up a nationwide basic minimum cost of living allowance system this year for rural residents, and the trial area of the new rural cooperative medical care system will be expanded to cover over 80 percent of all counties, county-level cities and city districts in China.
Last year, China has made "steady progress in building a new socialist countryside" last year, according to Wen.
Despite serious natural disasters, China last year saw a rich grain harvest with total output amounting to 497.45 billion kilograms, 13.44 billion kilograms more than the year before.
The per capita net income for the 900 million rural residents increased 7.4 percent to 3,587 yuan last year. Safe drinking water was made available to another 28.97 million rural people and the use of methane available to an additional 4.5 million rural families.
The country ended the agricultural tax that had been collected on grain farmers for more than 2,600 years, continued to increase direct subsidies to grain farmers, and followed a policy of granting general subsidies for agricultural production supplies.
Ⅴ Expand Rural Medicare System
China's rural medical care system will cover more than 80 percent counties.
"The trial area of the new type of rural cooperative medical care system will be expanded this year to cover over 80 percent of all counties, county-level cities and city districts in China. Areas possessing the proper conditions may expand the trial faster than others," said Premier Wen Jiabao in the government work report delivered to nearly 3,000 NPC deputies at the annual session of the top legislature.
The allocations from the central government budget to subsidize this trial will amount to 10.1 billion yuan (1.3 billion U.S. dollars) this year, a 5.8 billion yuan (750 million U.S. dollars) year-on-year increase, according to the government work report. (Source: chinadaily) |
