To say it is Liu Kun, the Chinese finance minister, who wants to support the real economy
In China new manoeuvres are expected to make fiscal policy more proactive. To say it is Liu Kun, the Chinese finance minister, who added that the corrective manoeuvres will not be revolutionary, but will serve as a stimulus.
During an interview with Xinhua, Liu also listed what the objectives of this manoeuvre are: the fiscal policy should be more forward-looking, flexible and effective to play a bigger role in boosting demand, restructuring the economy and promoting high-quality development.
The proactive fiscal policy will prioritize four sectors
The proactive fiscal policy will prioritize four sectors, namely cutting taxes and fees, improving weak links, boosting consumption and improving people’s livelihood.
These manoeuvres must however be linked to the economic policies already announced at the beginning of the year. China, in fact, to support the real economy and technological innovation, said it wants to reduce taxes. The burden on businesses should therefore drop from the 1.3 trillion yuan (around 188.4 billion dollars) of this year.
The country’s fiscal revenue rose 4 percent year on year
The first effect of this maneuver that wants to cut taxes, will obviously be that for which the growth of tax revenues will remain at a low level in the coming months.
The country’s fiscal revenue rose 4 percent year on year to 1.11 trillion yuan in August, slowing from the 6.1-percent gain in July. With the economy on firm footing and fiscal revenue increasing, China lowered its fiscal deficit target for 2018 to 2.6 percent of GDP.
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