The United States is one of the few countries that taxes citizens on all of their income, regardless of where in the world it is earned. But an additional billion-plus people might soon empathize with American taxpayers: The Chinese government is starting to enforce rules requiring that its citizens report income earned outside that country.
As The New York Times reports, the Chinese officially chose the same general definition of taxable income as used by the United States back in 1993, But only now is the Chinese government beginning to push its citizens to actually report worldwide income.
My favorite part of the NYT story describes how a group of Chinese tax officials first consulted with the U.S. more than 20 years ago on drafting a modern tax code:
“The team paid a long visit to the Internal Revenue Service and was given a two-volume bound copy of the United States tax code and a five-volume copy of I.R.S. regulations,” writes Hong Kong bureau chief Keith Bradsher.
Wow. If the Chinese liked getting that kind of help, they’ll love the United States Guide to Developing An Efficient And Popular Department of Motor Vehicles.