Growth may fuel cut to value-added tax rate

China could have the option to cut its value-added tax rate this year as part of its proactive fiscal policy to bolster its real economy with the country set to register higher fiscal revenue growth in 2017, a researcher suggested.

The highest tier of the current value-added tax rate, which is 17 percent, may have room for a potential cut of 1 to 2 percentage points this year, an amount equal to a reduction of more than 1 trillion yuan ($155.2 billion) in tax revenue, said the anonymous expert, who has done research on the matter.

The faster growth of fiscal revenue in 2017, which is predicted to be more than 8 percent year-on-year, will support the tax cut, the expert said. Fiscal revenue growth in 2016 was 4.5 percent.