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Growth in China fiscal spending slows in April, revenues up

Published 13/05/2016, 04:59
© Reuters. A customer counts Chinese yuan banknotes as she purchases vegetables at a market in Beijing

BEIJING (Reuters) - China's fiscal expenditures rose 4.5 percent in April from a year earlier, slowing sharply from a 20.1 percent jump in March, data from the Finance Ministry showed on Friday,

The government has pledged to ramp up fiscal support this year, boosting the fiscal deficit to 3 percent of gross domestic product (GDP), after economic growth last year cooled to a 25-year low.

Fiscal revenues climbed 14.4 percent in April from a year earlier, quickening from March's 7.1 percent rise.

April business tax receipts jumped 74.8 percent from a year earlier, as local governments rushed to clear up business tax arrears.

China has rolled out reforms to replace a business tax with a value-added tax (VAT) across all industries, effective from May 1, and the government hopes to cut taxes by more than 500 billion yuan in 2016.

"Currently, the downward pressure on the economy still existed and structural adjustments faced many difficulties," the ministry said in a statement.

Local governments will be banned from collecting excessive taxes and using illegal means to boost revenues, the ministry said.

© Reuters. A customer counts Chinese yuan banknotes as she purchases vegetables at a market in Beijing

For the first four months of the year, fiscal spending rose 12.4 percent compared with the same period in 2015, while revenue increased 8.6 percent, the data showed.

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