China reports steady growth in fiscal revenue

China posted stable growth in its fiscal revenue in the first quarter of 2018, official data showed, adding to evidence of a solid economy.

The Ministry of Finance holds a press conference in Beijing on Wednesday, April 19, 2018. [Photo: mof.gov.cn]

The fiscal revenue rose 13.6 percent year on year to 5.05 trillion yuan (more than 800 billion U.S. dollars) in the January-March period, the Ministry of Finance (MOF) said at a press conference Wednesday.

MOF official Lou Hong attributed the increase mainly to strong tax revenue, as businesses saw better performance amid a solid economy in the first three months. Revenues rose 28 percent in consumption tax, 21.1 percent in commercial value added tax and 14.4 percent in import tax.

Business and individual income taxes went up 11.7 percent and 20.7 percent respectively.

Lou expects fiscal revenue growth will moderate in the coming months but will remain steady.

During the January-March period, fiscal spending rose 10.9 percent year on year to 5.1 trillion yuan.

China has pumped more money into reforms, poverty relief, environmental protection and education to address unbalance in development since the beginning of the year, MOF official Wang Xinxiang said.

Government expenditures gained 76.8 percent on forest protection, 58 percent on poverty relief, 47.5 percent on applied research, 38.3 percent on agriculture, and 13.7 percent on basic pension fund. The central authority will also strengthen fiscal support for less-developed areas to improve people's livelihood, Wang said.

With the economy on a firm footing and fiscal revenue increasing, China lowered its fiscal deficit target to 2.6 percent of GDP for 2018, down by 0.4 percentage points compared with 2017, the first drop since 2013.

MOF data showed ten local governments including Hubei and Xinjiang have issued 219.5 billion yuan of bonds since January.

China will continue to improve bond issuance of local governments and step up prevention and control of debt risks, Lou said.

At the press conference, Lou also said China will continue to vigorously push forward negotiations of the Agreement of Government Procurement and strive for a win-win result as early as possible.

As the world's second largest economy, China's government procurement will provide a huge market to other participants, greatly improve international trade, and inject vitality into global economic recovery, Lou said.