Chinese Citizens Making CBDC Tax Payments – Adoption Rising?
China’s central bank digital currency (CBDC) is being used by citizens and businesses to pay their taxes, state organs, and government-owned banks, according to claims from Hunan Province’s Tax Bureau and the Changsha Central Branch of the People’s Bank of China (PBoC). In the period of January to June 2023, taxes totaling $51.3million were paid using the digital yuan, representing 794 transactions.
Of these transactions, 754 were conducted using the CBDC tax payment platform operated by the Postal Savings Bank’s Hunan Branch. This bank is owned by the government through China Post, and is one of the PBoC’s closest allies in e-CNY adoption efforts. It was the first bank to offer CBDC-powered tax payment solutions in the province, allowing individuals and companies to pay their taxes online. It also offers digital-yuan tax refund services.
The bank continues to optimize the digital yuan payment experience for its clients and actively promote the work of the ongoing digital yuan pilot. The pilot zone was expanded in April 2021 to include the city of Changsha, one of the largest cities in Hunan Province. Authorities in the city claimed that more than 420,000 merchants now accept payment in the CBDC, and that the uptake of digital yuan giveaways has been high, with some regions recording a usage rate of up to 99%.