China’s legislature on Thursday gave the green light to a measure that raises the monthly income tax threshold from US$308 to US$540, a move that aims to address low-income earners’ concerns about inflation, the Wall Street Journal reported. The new tax policy takes effect from September 1, and is US$77 higher than the US$464 level that officials proposed earlier. China’s average salary last year was US$479 per month in the non-private sector and US$268 per month in the urban private sector, according to the National Bureau of Statistics. After the reforms, only 7.7% of workers will need to pay personal income tax, down from 28% – reducing the government’s tax revenue by about US$25 billion per year. However, the new tax code will also increase taxes for high-income earners.