AIN'T no Summertime blues for me - here it is, the last week of August and I am so up-to-date on my work schedule that I am starting my monthly contribution to TII earlier than ever. Of course, if the various and sundry jurisdictions of this world ever ceased to issue new rules, regulations, etc, etc, I'd have nothing to write about…..but then again, there'd be nothing for any of us writers to write about - what a horrid thought!

Fortunately, jurisdictions will come up with sufficient material to be cynical about, month after month after month. Sometimes it is just like a perpetual motion, never-ending item (like the GST in India). Other times it is 'shock and awe', like the sporadic shots of fear that FATCA seems to be causing (or reminds us that it is trying to cause), if not the downright inconvenience. A client of mine, not an American, and not a Singaporean either, but with a corporate bank account in Singapore, received a form letter from their Singapore bank asking for the corporation to fill out a US IRS form W-8 BEN-E and return it to the bank - simply because of non-Singaporean owners. Does this portend GATCA?

Have you seen this form, yet? If not, go the IRS website and look at it! I defy you to tell me what this form is really for or how it is to be filled out or how one can even translate it to user-friendly English because the instructions are equally as unintelligible! Fortunately, my friends, let us use some logic to overcome fear: True, we do not understand any of this but neither does the bank sending out this form - and, in due course, neither does the IRS. All that is taking place is that bank's being able to ascertain that it is doing its due diligence in knowing its clients. KYC. That's the buzzword for the day. Now if I had anything to do with the bank, I would have told them to do anything but inflict an IRS form indiscriminately upon all of its 'foreign' clients, American and non-American alike. But as long as that dastardly deed has been done, then I'd advise all who receive anything like this (if not the exact same one as I am referring to) not to worry: the bank that sent it out ain't likely to do anything other than to ascertain that they've received it, fulfilling an important part of due diligence: they asked for and they received information that the IRS would love to get its hands on even though it won't because the bank has an obligation ONLY to get information, not to give it to anyone…..and I am not even willing to guess at how screwed up some of the answers (or lack, thereof) will be found amongst the forms actually returned to the bank - trust me, though, it will be a mess! Don't sweat it, folks: if you are asked to fill out the form, answer to the best of your ability, taking time to look at the instructions only when what you see looks like English and sounds like English…..but is otherwise some form of language that makes no sense whatsoever - and if that doesn't work, write in Not Applicable!! If I really had the guts, I'd write in 'KMA, IRS' but I only have the guts to voice my outrage at this idiocy within the confines of internet journalism, not on an IRS form!

To think…..I wasn't even going to mention anything US tax related until the end of this essay - I got off on a tangent and let the words flow…..how many words, though, is open to conjecture - I am trying out Microsoft Word on my iPad and cannot find a word count. Serves me right - I should stick with Pages - it works right, most of the time…..and it does provide the word count!

Anyhow, it is time (even without knowing the word count) to say something about Thailand, seeing how far I can go without getting myself into trouble with a military junta that started out doing the right things. But now? Perhaps some things are better left unsaid - such is life…..

And yet how can I resist writing about soon to retire National Chief of Police General Sonyat Poompunmuang and his goal of providing each and every Thailand police officer with the same side arm which, on a bulk purchase basis, say 150,000 guns, he can get that 150,000baht per gun list price knocked down to a truly fantastic amount of 18,000 bahtper weapon. And think of all this effort as a lasting memorial to his life's devotion to the police system of Thailand prior to his planned retirement before the end of the year. The only problem is that on the open market, one can procure the same exact weapon as Sonyat's choice for 15,000 - 17,000 baht. Is corruption getting this blatant from the officialdom related to the current junta - or has it always been like this. Of course it's always been like this!! And it always can be read on Sundays on page two of the Bangkok Post. If you are 'possessed' by cynicism, then a weekly dosage of BKK Post, page 2 is indeed a wonderful fix! Sadly, corruption is universal. Only in some jurisdictions it is done with perhaps a bit more finesse than elsewhere. Nonetheless, corruption is corruption is corruption and every little gain in making the world a bit more transparent is beneficial…..

O.K. - Enough cynicism for this article - let's get to some useful tax information from China…..

China Daily, Hong Kong edition, reported on Saturday, 22 August, that the State Council, at its executive meeting held 19 August, decided to increase the number of businesses eligible for a very sizable reduction in corporate tax through the end of 2017. A two year tax break is always beneficial! If you are a small business in China (and believe me, there are a lot of small businesses or start-ups in China that can take advantage of this) with annual taxable income of under 300,000 RMB, then you will now fall into a 10 percent bracket corporate tax bracket. 1 RMB over? 25 percent tax rate! In addition, if you are doing under 30,000 RMB in monthly sales, then there is quite a good chance that you will be exempt from either VAT or business tax for the next year. This VAT provision was set to expire but has been continued to help ignite a stagnant economy.What I am interested in finding out is how long the time gap between announcement of these tax reduction holidays and the State Administration of Taxation local offices being able to properly apply these reductions at the local level. The set up costs for small businesses in China consist of so many different fees and permits that a tax break would be welcome. Let's see how good this one actually is!

If I were to be limited to keeping current on but one area in the development of taxation in China it would be the property tax. Why? Because municipal spending on poorly conceived programs and infrastructure is, in my belief, rampantly out of control. Unfortunately, as with the current state of affairs, we'll never quite be sure how out of control because it is all so opaque.

Case in point" Caixin magazine (a wonderful magazine that really does try to 'push the envelope' of journalism in China) did a study that was published on 6 August 2015. 652 cities in China were asked to what extent they were indebted. So how many cities do you think answered? 50 percent?20 percent? How about less than 1 percent: only six out of 652 cities bothered to answer Caixin. Those cities: Beijing, Guangzhou, Shanghai, Tianjin, Ningbo and Xiamen. They were willing to reveal their debt. Other cities?Your guess is as good as mine. Yin Zhongqing, deputy director of the legislature finance committee said a year ago that local debt may have hit as high as 30 trillion RMB. At the Boao Asia Forum in March this year, Lou Jiwei, Minister of Finance disputed that amount, stating that it was only half: 15.8 trillion RMB. Frankly, my gut tells me that the higher amount is more likely to be correct. Without adequate supervision, some cities (many cities) in China have not been the most astute when it comes to fiscal management and I really do not think the State Council wants to continue to bail out fiscal irresponsibility. There are only two municipalities in China with a property tax (more of an excise tax, actually): Shanghai and Chongqing. By the end of 2017, there 'should' be a national property tax law enacted - that's what the plans call for. Yet development of a comprehensive land registration system, the foundation upon which a property tax is to be developed, will simply not be up and running by that time - far from it. The further away from Beijing, the more foot dragging seems to be taking place when it comes to setting up the registration system - perhaps because far too many lower level officials have too much to lose if their abuses of the system were to become known. Eventually it will be set up but it is going to take time - lots of time. And time is on side of reform to transparency - some day…..