Liu Lei, deputy to the National People's Congress: Optimizing the tax policy for equity incentives 　　

Equity incentive is a long-term incentive mechanism for enterprises to attract, retain and motivate core talents

"As far as the current situation of listed companies' implementation of equity incentives, there are still problems such as heavy tax burdens, limited equity incentive methods, limited scope of equity incentive objects, and capital occupation

In order to improve the enthusiasm of listed companies to implement equity incentives and maximize the role of equity incentive plans, Liu Lei put forward the following four suggestions

The first is to optimize the tax policy for equity incentives, and adjust the tax time for equity incentives of listed companies to the date when the incentive object actually transfers the relevant equity

The second is to levy the individual income tax rate of incentive objects with reference to the 20% tax rate applicable to income from property transfer

The third is to allow enterprises to declare the pre-tax deduction of corporate income tax during the period when the incentive expenses are listed, and settle and pay according to the “difference between the market price and the exercise price when the option is actually exercised” in the current period when the equity incentive is completed.

The fourth is to cancel the accounting treatment requirements of the Accounting Standards that the voluntary termination of equity incentives still needs to confirm the accelerated exercise expenses, so as to avoid enterprises from confirming large expenses and reduce the burden of expenses that cannot be deducted from the taxable amount of enterprise income tax, so as to facilitate enterprises in the Introduce new incentive schemes as soon as possible after terminating invalid incentives