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

Updated: 2011-03-18 14:58
( Xinhua)

2. Accelerating reform of the fiscal and taxation systems and vigorously establishing fiscal and taxation systems and mechanisms conducive to transforming the pattern of economic development

We will improve the public finance system so that the financial resources of governments are in line with their respective powers. We will improve the transfer payment system and use transfer payments more effectively. We will improve public finance systems at or below the provincial level, and complete our work related to improving the mechanism for ensuring basic funding for county-level governments. We will press ahead with the reform to place county finances directly under the management of provincial governments and township finances under the management of county governments. We will improve public finance budgets, make budgets for government-managed funds more detailed, expand the scope within which budgets for state capital operations are implemented and improve related policies and measures, and continue to compile the national budget for social insurance funds on a trial basis. We will eliminate all extrabudgetary funds and place all government revenues under budgetary management. We will thoroughly carry out reforms of departmental budgeting, centralized treasury collection and payment, government procurement and other budget management systems. We will establish a sound budgetary performance management system. We will study how to reform government accounting, and explore ways to prepare government balance sheets on a trial basis. We will carry out experimental VAT reform in some producer services, and adjust and reduce business tax correspondingly to establish institutions for gradually unifying tax policies for goods and services. We will improve the sales tax system, and levy sales taxes on some products that cause environmental pollution or consume large amounts of energy, as well as on some luxury consumer goods. We will improve the personal income tax system, raise the personal income tax threshold on salaries, rationally adjust the tax rate structure, reduce the tax burden on low- and middle-income earners, and strengthen controls on high income. We will further carry forward the reform of resource taxes. In accordance with the principle of rectifying taxes and eliminating fees, we will put non-tax government revenue in order and increase the proportion of tax revenue in total fiscal revenue.

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