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Speculation that the government will reduce or remove the tax on interest income Monday caused the stock market to plummet 3.68 percent.

The 28th session of the Standing Committee of the National People's Congress (NPC), which has been in meetings since Sunday and is scheduled to soon decide on a series of acts, may vote on a proposal authorizing the State Council to adjust or remove the tax on interest income, which could prompt investors to stockpile their money in bank savings accounts rather than buy stocks.

The vote is likely to take place on Friday, the last day of meetings, according to sources close to the NPC and the central government.

The main stock index has dropped 290 points since Friday, when news started to spread.

The Shanghai Composite Index closed at 3,941.081 points yesterday, its first drop below 4,000 points since June 12, after sinking as much as 4.38 percent at one point in the day. On Friday, it tumbled 3.29 percent.

Editor: Yan