Middle-school and college teachers are among the top paid people in China, according to statistics from the State Administration of Taxation -- which is amazing given that the image of teachers being poor in China is still fresh in the memory of most people. Teachers have become the latest affluent group in China’s urban society thanks to an information-based society in which learning has become a prerequisite to making money.
Haidian District [Beijing’s "Silicon Valley" which is also home to institutions of research and higher learning such as Peking University] sports a new nickname this year -- "rich district." As more and more high-income individuals came to live in Haidian, a local Haidian tax bureau -- unique among local administrations -- was setup in 1994, marking a turning point in China’s taxation system. At first, income tax added up to more than 30 million yuan (US$3.6 million); then it exceeded 80 million yuan(US$ 9.6million) in 1995 and hit 910 million yuan (US$109.6 million) in 2000. As of November 2001, tax collected in Haidian amounted to 1.79 billion yuan (US$215.7 million) -- with 87.5 percent of that coming from individual income tax. Zhao Hong, deputy director of the Haidian local tax bureau said: "Income tax doubled or tripled in the past several years, and this year it may exceed 2 billion yuan (US$241 million)."
Haidian District has more knowledge-based institutions than any place in China. More than 6,000 high-tech companies were located in 2001 in Haidian’s Zhongguancun Science Park. The employees of these enterprises represent a sizeable high-income group with a consumer pattern that promotes peripheral local industries and services. According to the Haidian tax bureau, income tax collected in 2000 in Haidian amounted to 16 percent of the whole city of Beijing -- 1.7 percent of the whole country. And it is estimated that the number for 2001 will rise to 2 percent. That is to say, for every 100 yuan in income tax collected in China, two yuan come from Haidian.
Dr. Cao Ziwei, of the National Statistics Bureau, thinks that the growing income of those who work in the IT industry and other high-tech industries is a direct result of China’s market reforms. Income earned in knowledge-based institutions has soared compared to other areas on society.
Dr. Cao Ziwei was a participant in the "investigation of high-income groups in 10 cities and provinces," a government-sponsored investigation that provoked wide discussion in China for its revelations of how people got rich over the past 20 or so years during market reforms that involved four steps, first the opening up of distribution; then production; then finance; and now knowledge-based and technology fields.
Distribution opportunities opened up in the 1980s when life was still a struggle for most Beijing citizens. At that time, some garment vendors -- because of their awareness of how the market works -- got rather rich compared to people in most state-owned enterprises. But these simple business trade activities did not enable those involved to enter the more mainstream of social and economic life.
But now that market forces have entered knowledge and technology fields and intelligence can rapidly be converted into profit and personal fortune. "Twenty years ago, we had a saying in Beijing, ‘Eggheads are losing out to egg-sellers.’ But now those days will never return." Dr. Cao said.
(From 北京青年报 [Beijing Youth Daily] December 20, 2001 translated by Li Liangdu for china.org.cn)
