Full text: Report on China's central, local budgets

3. Revenue and expenditures for 2017

1) General public budgets

Revenue in the central government's general public budget is expected to reach 7.8612 trillion yuan, an increase of 3.8 percent over the actual figure for 2016. Adding in the 135 billion yuan from the Central Budget Stabilization Fund and the 28.3 billion yuan from the budgets of central government-managed funds and central government state capital operations, revenue for 2017 should total 8.0245 trillion yuan. Expenditures through the central government's general public budget are projected to reach 9.5745 trillion yuan, an increase of 6.1 percent. Total expenditures are projected to exceed total revenue, leaving a deficit of 1.55 trillion yuan, an increase of 150 billion yuan over last year. The ceiling for the outstanding balance of central government bonds is 14.140835 trillion yuan. The Central Budget Stabilization Fund is projected to carry a balance of 132.806 billion yuan.

Expenditures in the central government's general public budget are divided into central government expenditures, tax rebates and transfer payments to local governments, and payments to central government reserve funds.

(1) Central government expenditures are projected to reach 2.9595 trillion yuan, up 6.5 percent over last year, a drop of 0.5 percentage points over the 7 percent growth rate project for 2016. 

(2) Tax rebates are projected to be 913.8 billion yuan. This includes 703.643 billion yuan in VAT rebates, 101.092 billion yuan in excise tax rebates, 91.019 billion yuan in income tax rebates for making up the difference when local government income tax revenue falls short of the figure for 2001, 153.11 billion yuan in tax rebates resulting from the reform of taxes and fees related to refined oil products, and tax rebates on the counterbalance of the revenue turned over by local governments.

(3) Transfer payments are projected to amount to 5.6512 trillion yuan, up 7 percent over last year, an increase of 1.4 percentage points over the 5.6 percent projected growth rate for 2016. This is mainly due to increases in transfer payments for equalizing access to basic public services, financial subsidies to poor regions, and investments in helping local governments further strengthen areas of weakness. Of this amount, general transfer payments are projected to come to 3.503049 trillion yuan, up 9.5 percent; and special transfer payments are projected to reach 2.148151 trillion yuan, an increase of 3.1 percent. General transfer payments include 2.230883 trillion yuan in transfer payments for equalizing access to basic public services, up 8 percent, and 183.29 billion yuan in transfer payments to old revolutionary bases, ethnic minority areas, border areas, and poor areas, up 19 percent. We will continue to ensure the coverage of special transfer payments in agriculture, education, social security, medical care, employment, ecological conservation, housing support, and other key areas. We will further overhaul special transfer payments by merging and reorganizing a number of items and appropriately reducing the payment amounts for certain items.

(4) A total of 50 billion yuan is projected for the reserve funds, which is consistent with the budgeted figure for 2016. During the course of implementation, the reserve funds will be counted as central government expenditures or transfer payments to local governments according to conditions.

Revenue in local governments' general public budgets is projected to reach 9.0018 trillion yuan, up 6 percent from last year. Adding in the 6.565 trillion yuan in tax rebates and transfer payments from the central government and the 80 billion yuan transferred from other local sources, this revenue is expected to total 15.6468 trillion yuan. Expenditures in local governments' general public budgets are projected to be 16.4768 trillion yuan, an increase of 6.2 percent over the actual figure for 2016 after allowing for utilized carryover and surplus funds from last year and funds transferred from other sources. This leaves a deficit of 830 billion yuan, an increase of 50 billion yuan. Local governments will make up for this deficit through the issuance of general bonds. The ceiling for the outstanding balance of local government general bonds will be 11.548922 trillion yuan.

Revenue in the general public budgets of both the central and local governments is projected to amount to 16.863 trillion yuan, up 5 percent. Adding in the 243.3 billion yuan transferred from other sources, this revenue is expected to total 17.1063 trillion yuan. Government expenditures in China are budgeted at 19.4863 trillion yuan, an increase of 6.5 percent over the actual figure for 2016 after allowing for local governments' utilized carryover and surplus funds from last year and funds transferred from other sources. This leaves a deficit of 2.38 trillion yuan, an increase of 200 billion yuan over 2016.

The above figures for budgeted revenue and expenditures for 2017 also take into account revenue into and expenditures through government-managed fund budgets that have been transferred into general public budgets: as of January 1, 2017, in order to increase coordination in the use of government funds, the revenue into and expenditures through three government-managed funds-fees for the compensated use of additional land designated for construction projects, South-to-North Water Diversion Project funds, and special use revenue turned over by tobacco companies-have been transferred into general public budgets. While we have reduced budgetary revenue and expenditures for government-managed funds, we have made corresponding increases to the projected revenue and expenditure figures for the 2017 general public budgets as well as to the revenue and expenditure baseline figures for 2016.

2) Budgets for government-managed funds

Revenue into central government-managed funds is projected to reach 370.649 billion yuan, up 3.2 percent. Adding in the 29.85 billion yuan carried forward from last year, revenue into central government-managed funds will total 400.499 billion yuan. Expenditures from central government-managed funds are expected to be 400.499 billion yuan, up 19.2 percent, which is mainly due to the increased use of funds carried forward from last year. This figure consists of 288.114 billion yuan in central government expenditures, up 14.5 percent, and 112.385 billion yuan in transfer payments to local governments, up 33 percent.