China promises further VAT cut even as tax revenues dive

Updated 2018-03-26 09:11:03

China's tax revenues fell by 918.6 billion yuan (145.5 billion US dollars) last year as a result of changes to the tax structure, Minister of Finance Liu Kun said on Sunday.

A cornerstone of the reforms was the replacement of the business tax (BT) with a value-added tax (VAT) in 2016.

Liu said that major sectors like manufacturing and transportation can expect further VAT cuts this year.

As part of the efforts to reform China's state-centric fiscal system, VAT was first introduced in 2012 in Shanghai, China's financial hub, in selected industries. It was expanded to eight other regions the same year and eventually rolled out nationwide in May 2016.

The latest cuts are an extension of tax reforms since 2013 when the government slashed more than 3 trillion yuan in taxes and fees on companies, a process Premier Li Keqiang said was vital to improve the country's competitiveness and protect entrepreneurship.

"China aims at setting up optimized taxation system and structure in accordance with international tax reform," Liu said at the China Development Forum.

China's tax reforms have given the country more global competitiveness. Based on OECD's VAT and GST guidance, tax reforms have been "instrumental in supporting economic activity, boosting growth and strengthening China's international competitiveness, particularly in the services sector," Angel Gurria, Secretary-General of OECD, said at the forum.

The annual forum, which kicked off on Sunday with the theme "China in the New Era," has attracted over 30 globally renowned scholars, including seven Nobel laureates and more than 80 executives of Fortune 500 Firms.

Also in the News

Nicole Kidman Recalls Oscar Glory: Loneliest Time
Showbiz2016/06/16 13:58January 20 2019 17:27:23

Nicole Kidman Recalls Oscar Glory: Loneliest Time

Attending Shanghai International Film Festival, Nicole Kidman talks about her role in "Grace of Monaco".

Labor Day Travel Peak Starts
Also in the News2014/05/01 12:16January 20 2019 17:27:23

Labor Day Travel Peak Starts

Johnny Depp Delivers a Speech 'Evolve the Future' in 'Transcendence'
Also in the News2014/04/18 13:18January 20 2019 17:27:23

Johnny Depp Delivers a Speech 'Evolve the Future' in 'Transcendence'

Hollywood star Johnny Depp's speech in the upcoming new film "Transcendence" has been disclosed on Friday, April 11th.

China World Business Sports Showbiz Audio
C4 My Chinese Life The Sound Stage China Revealed Showbiz Video Travel Video
China World Fun Travel Entertainment Sports
Beijing Shanghai Guangzhou
Live Music Opera & Classical Movies Traditional Shows Exhibitions
Learn Chinese:
Chinese Studio Living Chinese Everyday Chinese Just For Fun Chinese Culture Buzzwords