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Li: Tax, fee cuts help stimulate vitality

By Xu Wei | China Daily | Updated: 2019-05-27 07:23
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Premier Li Keqiang asks locals about fruit prices at a grocery store during an inspection tour in Weifang and Jinan, Shandong province, on May 25, 2019. [Photo/Xinhua by Liu Weibing]

Premier calls for full implementation of measures to consolidate growth

Premier Li Keqiang called for full implementation of tax cuts and fee reductions to better stimulate market vitality and consolidate economic growth during an inspection trip in Shandong province on Friday and Saturday.

The tax and fee cuts are crucial measures to coping with complicating circumstances and to withstanding new downward pressure on the economy, the premier said while visiting Weichai Group, a manufacturer in Weifang, on Friday.

Over a longer period, such measures can also bolster growth potential and broaden the tax base, so it is important to ensure the lasting impact of the tax and fee reductions, he said.

In March, China rolled out a series of measures to reduce businesses' tax burdens and social insurance contributions by nearly 2 trillion yuan ($290 billion), with manufacturing sector companies being the largest beneficiaries.

Li encouraged businesses like Weichai to step up international cooperation in innovation to ensure unrelenting growth in China's manufacturing sector.

At Goertek Inc, an acoustic components maker, Li learned that the tax cuts had already reduced its corporate burdens by 100 million yuan.

The premier voiced appreciation for Goertek's efforts to prioritize research and innovation and to explore the domestic and international markets.

Premier Li Keqiang talks with employees during an inspection tour of  Goertek, an acoustic components maker, in Weifang city, Shandong province, May 24, 2019. [Photo/Xinhua]

There is huge potential in the Chinese market, he said, and it is important to win over consumers and the market with innovations in science and technology and through extensive cooperation.

Li pledged better policies to encourage businesses to increase research and development and to improve the level of innovation across the board in China.

Li also presided over a symposium on the tax and fee reductions in Jinan on Friday, the second meeting of its kind within two weeks.

The Chinese economy, despite its good start in the first quarter, has not yet consolidated its stable momentum as it faces increasing unstable factors and challenges from abroad, Li said at the symposium.

Although the tax and fee reductions will temporarily decrease fiscal revenues, they will bolster businesses' confidence to increase investment for further growth, thus creating jobs and shoring up economic growth, he said.

It is important to ensure that all sectors see their tax burdens lowered and that the prices of materials used in agriculture remain stable, he said.

Li also called for local authorities to fully implement the tax and fee reductions and to maintain balance between fiscal revenues and expenditures.

He cautioned that they should not bend rules in ways that increase burdens on businesses to alleviate the pressure on government finance.

The Chinese economy is highly resilient, and the government has adequate room to maneuver in its macro-regulation policies, he added.

China will introduce further relaxed terms and refined procedures for deductions of the VAT in the manufacturing sector and come up with support policies for R&D and innovation in businesses, he said.

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