By Azania Post Reporter
CHINA has saved USD billion 244 a year ago as most aggressive tax cuts from business owners, authorities has said.
From May 2016 to June 2017, taxes were reduced by over 850 billion yuan and the country has promised continue value added tax reform to boost economy.
VAT reform is a key part of supply-side economic reform and has made good progress, according to a statement released after a State Council executive meeting presided over by Premier Li Keqiang.
The reform streamlines the tax system, reduce double taxation, helps innovation and industrial upgrading and while boosting employment.
It shores up the economy and gives new impetus for the economy to grow at a medium to high rate or higher level, according to the statement. The government will further streamline taxation procedures and introduce information technology to make them easier and more efficient.
It will also improve the situation in sectors including manufacturing, finance and construction, optimize tax structure and set a reasonable tax rate.
Laws will be revised as soon as possible to reflect the new system
The VAT reform was first piloted in Shanghai in 2012. It was expanded nationwide starting from May 1, 2016. China's VAT rate structure was further cut from four to three tiers (6 percent, 11 percent and 17 percent) starting from July 2017, with tax rates for farm produce, tap water and books reduced to 11 percent from 13 percent.
"The full implementation of the VAT reform pilot program is a strong pillar of this administration's efforts to boost effectiveness of the proactive fiscal policy and the supply-side structural reform," Li said.
"One year on, the reform is paying off. Sectors across the board have seen their tax burden reduced. It did not come easy."
The meeting decided that the government will also push forward legislation on VAT, fine tune VAT arrangements for maximum results and secure progress made in the reform in the legal form.
"The VAT reform is a systematic project, and government departments should work in synergy. The VAT reform, besides reducing tax burden for enterprises, can also leverage institutional reforms, and contribute to innovation, entrepreneurship, job creation and expansion of the industry chain," Li said.