Mr. Deng: Gao Ting the right to pay taxes

Mr. Deng a few days ago, the Ministry of Finance issued a notice to the listed company executives to obtain stock options in the right, the tax is indeed difficult, by the competent tax authorities audit, can be from the date of its stock options line, in no more than 6 months period of time to pay individual income tax.　　Before the listed company executive Personnel option incentive to pay personal income tax time is, the right to pay taxes. At present, the stock option starting point of China's listed companies is to calculate and pay the personal income tax according to the price difference between the closing price of the right day and the original line weight, rather than the selling price and the line pricing difference when the stock is cashed. This makes it possible for executives or employees of listed companies that have gained stock incentives to face at least two risks: one is to pay taxes in advance, you may have to bear the time risk and cost for high taxes; second, because the right link incentive object did not get cash income, it is likely to be forced to sell some stocks to ease the conflict of funds, so that incentive discounts.　　Not to mention the risk of a fall in share prices. According to Statistics, 2005, the implementation of equity incentive, China has nearly 150 listed companies announced equity incentive plans, and since 2008, a total of 54 companies to stop the implementation of equity incentives. The analysis holds that one of the reasons is that the right price of stock option is too high.　　The existence of right and market spreads, so that the incentive object if the right, but will lose a lot of money, lost the original incentive, and some listed companies in the last year, the price of the stock market continued to fall too high, but also make some company executives have not become "billionaire" first into "billions of negative weng." According to the daily economic news, according to the relevant regulations, executives must wait until the line of Rights Day 6 months before the cash, and even after 6 months, executives can only sell the shares of 25%, but the equivalent of 100% shares of the sale of personal income tax, which is also a financial pressure, resulting in a mismatch between income and taxes.　　Therefore, the news of the bird's secret, said the wavelet, now tax time has a 6-month buffer period, but still did not solve the actual problem. Not only that, the existing right to pay taxes may also induce the executive of some irregular market behavior. Because executives want to circumvent the high tax risk of the right to act, some of the measures he has taken will hurt the interests of small and medium-sized shareholders in the two tier market. Executives, for example, use their information advantages to deliberately depress share prices to reduce taxes in the right of ownership, and to induce manipulation of share prices by selling them at a time when they are making more gains from higher stock prices, or by arbitrage when the corporate crisis has not yet emerged.　　We know that manipulating share prices has always been a chronic disease in China's capital markets, and although regulators have been tough on this, there are always people desperate to do so, and there is a tax factor here. Since taxes are paid before executives get paid, and if there is no other way to finance a hefty tax, some companies usually take the tax on behalf of the company's executives and then return the money to the company within a fiscal year. Executives are not responding to direct pressure from the tax department,Therefore, we do not rule out the possibility of resolving this part of the tax burden through various ways in the future, so that the interests of small investors will be impaired. Now, the Treasury's notice gives the tax time a 6-month buffer period. But the relevant aspects or put forward, "did not solve the actual problem", then, does it mean that the right to pay taxes on the issue, the relevant departments have a lot of room for change? For example, to reduce the tax rate of the proceeds of the right of return, to extend the buffer period or to change the time of tax obligation, so as to match the tax rate with the time of holding the stock. The purpose of carrying out the equity incentive is to make the executive better serve the enterprise and thus to serve the society, and if the executive gives up the right to pay taxes too high, it loses the meaning of the equity incentive.