China launches private pension plan to supplement insurance mechanism

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China launches private pension plan to supplement insurance mechanism

Senior citizens are chatting at a retirement home in Beijing, China, thanks to this undated file photo. PHOTO XINHUA BEIJING - China has announced the implementation of its private pension plan to supplement the country's old-age insurance mechanism.

Applicants can open their own individual pension accounts, which can collect up to 12,000 yuan about $1,682. They get tax incentives for 11 years and enjoy a lot of them. The account is intended to be used for buying certain old-age financial products.

The government-supported voluntary and market-oriented pension plan is open to qualified citizens in 36 pilot cities and regions including Beijing, Shanghai, Guangzhou, Xi'an and Chengdu, according to the Ministry of Human Resources and Social Security.

Applicants can open their own individual pension accounts, which can collect up to 12,000 yuan about $1,682. The tax incentives are offered for 11 years. The account is intended to be used for buying certain old-age financial products.

READ MORE: Private pension scheme is a boon for the public.

China has a three-pillar old-age insurance mechanism, covering the national basic old-age insurance, the enterprise and occupational annuities, and the commercial old-age financial products and private pension plan.