Beijing: Chinese investors holding a stock for more than one year will be exempted from a 5-percent dividend tax from Tuesday, a move aimed at boosting long term investment following recent stock market collapse in the world's second biggest economy.
Those who have held a stock for one month or less will have to pay 20 percent of the dividend they receive as income tax when they sell the stock, the government said today.
People who have held a stock for over one month to one year will have to pay a 10 percent dividend tax when they sell the stock, state-run Xinhua news agency quoted a joint statement issued by the Ministry of Finance and the country's taxation authority and the securities regulator.
The move is part of the government's efforts to promote long-term investment following a stock market rout since mid-June, that liquidated USD 3.2 trillion capital.
The Shanghai Composite has also plunged more than 40 percent from its peak on June 12.
