The recovery of the second-largest economy in the world – China – is further consolidating in the second quarter, and tax revenues will grow, although the economy still faces a number of uncertainties both domestically and abroad, according to Reuters.
Last year, China’s GDP grew by 3%, the weakest performance in almost half a century. But Beijing has set itself a modest target – growth of around 5% per year.
China’s tax administration has promised entrepreneurs a reduction in fees and taxes totaling more than 1.8 trillion yuan ($261.62 billion) this year to stimulate economic growth. Last year, China reduced fees and provided tax breaks to private enterprises that were significantly affected by COVID-19 restrictions.
Tax and fee reductions, tax refunds, and deferred payments totaled 4.2 trillion yuan, more than half of which were VAT exemptions, the largest exemption in years.
In March, the country’s premier, Li Qiang, announced that some taxes would be reduced for small businesses and individual businesses, and that this preferential practice would continue until the end of 2024.