China recorded a fiscal surplus of 283.7 billion yuan (US$34.2
billion) during the first 11 months of this year.
The country's fiscal revenue stood at 2.44 trillion yuan
(US$294.3 billion), an increase of 23.5 per cent compared with the
same period a year ago, Finance Minister Jin Renqing said
yesterday.
The fiscal expenditure of 2.16 trillion yuan (US$260.1 billion)
represents an increase of 14.1 per cent.
The country's fiscal revenue is likely to reach 2.6 trillion
yuan (US$313 billion) for the whole of this year, Jin said at the
annual national finance conference staged in the capital
Beijing.
With an aim to beef up and improve the country's macro control,
and to promote a fast and solid economic development, the central
government has decided to carry out a 'prudent fiscal policy' next
year. "The government will reduce the amount of the central fiscal
deficit to prevent both inflation and deflation," he said.
He said earlier in an article published in People's
Daily newspaper that the country will keep the central fiscal
deficit at about 300 billion yuan (US$36.1 billion) in the near
term.
"The fiscal deficit/GDP ratio will drop to about 2 per cent next
year," he said.
"The prudent fiscal policy will play a more active role in
removing the unhealthy and unstable factors existing in the
economic development and stabilizing the performance of the macro
economy," Jin added.
"It will also play an important and active role in consolidating
the base for long-term social and economic development and
increasing the sustainability of the development," he said.
Central finance will continue to offer preferential fiscal and
tax policies for the development of the western areas and
renovation of the old industrial areas in Northeast China.
The government will reduce the issuance of special bonds for
construction.
The government says it will beef up construction of rural
infrastructure projects and large water projects, he said.
It will also support grain production and improvement of the
rural production and living conditions, it said.
Development in the old revolutionary base areas, border areas,
poor areas and areas where ethnic minority groups live will be
backed, and support will be given to key projects such as
construction of the Qinghai-Tibet Railway and the west-to-east gas
project.
While maintaining a stable growth in the fiscal revenue, the
government will actively push forward the structural tax system
reform, Jin added.
The government will firmly push forward the value-added tax
reform, which started on a trial basis in the country's northeast
provinces from July 1 this year.
The reform, which allows companies in the old industrial bases
of Jilin, Liaoning and Heilongjiang provinces to claim tax
deductions when buying new machinery equipment, will be expanded to
some other regions.
(China Daily December 22, 2004)