in 2020, in the face of severe complicated environment both at home and abroad, especially covid - 19 outbreak hit hard, active for a proactive fiscal policy - tax cuts jiangfei unprecedented, special bond stimulating investment to force, direct funds "paint", these measures in the fight against outbreaks and grasp the "six stability" in the process of promoting the "six protect" played an important role, take the bottom line of the people's livelihood, stabilize the market economy.
on the other hand, we need to reduce the burden on market entities, which will affect government revenue in the short term. expenditures to ensure people's wellbeing and major national strategic tasks have only increased. as our fiscal work continues to grow, we have faced more difficulties and greater challenges than we have seen in many years.
the year 2020 has already come to an end. what is the state of the country's "purse" and what are the "bills" of fiscal revenues and expenditures for the whole year? on jan 28, the ministry of finance held an online press conference on fiscal revenue and expenditure for 2020, introducing the fiscal revenue and expenditure for 2020.
we will do everything possible to overcome difficulties in increasing expenditures and reducing revenues, and ensure that key expenditures are effectively guaranteed
in 2020, national revenue in the general public budget will reach 18.2895 trillion yuan, down 3.9 percent year on year; expenditure in the general public budget nationwide is 2.4588 trillion yuan, up 2.8% year on year.
"leading indicators are better than expected." treasury officials said, as the jiangfei to push for tax cuts and fiscal fund direct mechanism and scale to help companies bail-out fall to the ground, the steady economic recovery, improve revenue quarter by quarter, epidemic prevention and control, poverty engines, the key areas of grassroots "miho" spending get effective guarantee, run mainly presents the following characteristics - year financial revenue and expenditure
first, the economy continued to recover steadily, with government revenue rising quarter by quarter. from the first quarter to the fourth quarter of 2020, china's general public budget revenue will increase by -14.3 percent, -7.4 percent, 4.7 percent and 5.5 percent, respectively, showing a trend of bottoming out in the second quarter after a sharp decline in the first quarter, turning from negative to positive in the third quarter, and continuing to improve in the fourth quarter.
second, major economic indicators stabilized and improved, leading to a rebound in the growth of major taxes. value-added tax and excise tax on imported goods were reduced by 8.1%, but the reduction was gradually narrowed as the growth rate of general trade imports recovered. corporate income tax fell by 2.4%, but corporate profits recovered in the second half of the year, leading to a narrower decline in revenue. the personal income tax increased by 11.4%, mainly due to the increase in personal income as the economy recovered and the increase in property income such as equity transfer.
third, putting state-owned resources and assets to good use through multiple channels boosted local non-tax revenue, and fees related to enterprises continued to drop. governments at all levels put state resources and assets to good use through multiple channels to increase revenue, driving up local non-tax revenue by 5.6%. the burden on businesses continued to ease. revenue from administrative fees fell by 1.4 percent nationwide, and revenue from special items such as education surcharges fell by 0.3 percent.
fourth, general expenditures were reduced, and expenditures in key areas were effectively guaranteed. spending on general public services nationwide and on urban and rural communities fell by 1.1% and 20% respectively. at the same time, expenditures in key areas such as epidemic prevention and control, poverty alleviation, and community-level "three guarantees" have been effectively guaranteed. for example, public health expenditure directly related to epidemic prevention and control increased by 74.9 percent, poverty alleviation expenditure increased by 1.5 percent over the 14.3 percent increase in 2019, and social security and employment expenditure increased by 10.9 percent.
"in february and march, when the epidemic was spreading, national fiscal revenue fell by 21.4 percent and 26.1 percent, respectively, and the gap between government revenue and expenditure was very serious." the chief says, in the face of adverse situation, comprehensive to include financial department through various channels to raise money, set up and implement capital direct mechanism, contends government, to optimize expenditure structure, increase of local financial support and a series of measures, to explore the cutbacks and potential, and maintain a balanced budget and financial stability, play a key role in financial stability and economic.
"in general, as the situation in epidemic prevention and control improves and the economy gradually recovers, fiscal revenue will steadily rebound in 2020, key spending will be well guaranteed, and the budget will be implemented well on the whole." "the official said.
the measures to reduce taxes and fees supported epidemic prevention and control, insurance and supply, and the resumption of business operations
in 2020, the ministry of finance, together with other relevant departments, intensified efforts to reduce taxes and fees, introduced and implemented 28 targeted tax and fee reduction measures in seven batches to support epidemic prevention and control, guarantee supplies, assist industries greatly affected by the epidemic, and support enterprises in resuming work.
-- focusing on supporting the development of small and micro businesses. nearly 90 percent of china's more than 50 million small-scale taxpayers will be exempted from vat, and the rate for the remaining 6 million will be reduced from 3 percent to 1 percent. in the first 11 months of 2020, a total of 91.1 billion yuan will be exempted from vat.
-- effectively ensuring the production and supply of materials for epidemic prevention and control. from january to november 2020, a total of 65.2 billion yuan of taxes and fees were reduced or exempted for enterprises producing key supplies for epidemic prevention and control, supporting them to increase cash flow, reduce capital use and expand production, greatly improving their ability to provide supplies for epidemic prevention and control.
-- helping enterprises in difficult industries resume work and production. from january to november in 2020, taxpayers will be exempted from vat, and 38.2 billion yuan will be cut in taxes and fees for transportation, accommodation and service industries that are greatly affected by the epidemic. taxpayers severely affected by the epidemic were exempted from property tax and urban land use tax, totaling 29.2 billion yuan.
-- we gave strong support to maintaining stable employment and ensuring people's wellbeing. by the end of 2020, the tax burden rate on sales revenue of 100,000 enterprises with key tax sources is expected to drop by 8% year on year. a total of 11.44 million new tax-related market entities were registered nationwide, up 10.1% year on year and higher than the level of the previous two years. the number of market entities grew rapidly, providing strong support for ensuring private employment.
"in 2021, we will continue to push forward the policy of reducing taxes and fees, and continue to deepen the reform of value-added tax (vat), special additional deductions for personal income tax and other institutional policies to reduce taxes and fees. we will continue to implement preferential tax cuts and exemptions for small and micro businesses." the official said the government will continue to improve the precision and effectiveness of the policies to ensure that the tax and fee cuts continue to be effective. "on the one hand, we need to improve the mechanism for implementing tax and fee cuts, do a good job in monitoring and analyzing the effects of these cuts, and promptly study and solve prominent problems reported by enterprises to help them make full use of these policies. at the same time, we will continue to improve tax services and ensure that taxes and fees are cut every step of the way. we will strengthen the regulation of all kinds of illegal fees and fees charged by enterprises to ensure that all measures are implemented in place."
special bonds were issued and used well, and the effect of the policy met expectations
in 2020, the national people's congress approved an additional 3.75 trillion yuan of special bond quotas, which have been allocated by the central government to all provinces (autonomous regions and municipalities directly under the central government) in batches with the approval of the state council.
special bond finance relevant controller introduces, the local government to support small and medium-sized banks resolve risks, used for transportation, municipal and industrial park infrastructure, as well as professional education and childcare, health, pension and other service sector accounts for about eighty percent of the people's livelihood, used for ecological and environmental protection, agriculture, forestry and water conservancy, energy, cold chain logistics in fields such as accounting for about twenty percent.
"in general, the issuance and use of special bonds in 2020 has been sound and in line with policy expectations, effectively playing a positive role in hedging the impact of the epidemic, expanding effective investment and promoting the smooth operation of the macro economy." "the official said.
central economic work conference put forward, to tackle the local government implicit debt risk work. so, how is the risk of our government debt at present?
statistics released by the ministry of finance show that by the end of 2020, china's local government debt balance was 25.66 trillion yuan, within the limit of 28.81 trillion yuan approved by the npc. adding the central government debt balance under budgetary management of 20.89 trillion yuan, the national government debt balance was 46.55 trillion yuan. based on the preliminary gdp estimate of 101.6 trillion yuan for 2020 released by the national bureau of statistics, the government debt-to-gdp ratio (debt-to-gdp ratio) is 45.8 percent, below the international warning line of 60 percent, and the risks are generally under control.
the official said that in the next step, the government will follow the principle of "opening the front door and blocking the back door", further improve the mechanism for local governments to standardize the financing of debt, resolutely curb the increase of hidden debt, and all new hidden debt activities will be discovered, investigated, and held accountable for their whole life and backward investigation. "with respect to hidden debt, we need to improve the mechanisms for regular monitoring, verification and inspection, identify and deal with potential risks as early as possible, and ensure that no systemic risks occur."
source: ministry of finance, prc