The Chinese central government has unveiled a bumper tax refund as part of efforts to keep the national economy on an even keel.
On 21 March the State Council announced that it would implement 1.5 trillion yuan (approx. USD$236 billion) in value-added tax (VAT) refunds in 2022, for the purpose of “providing vigorous support to stabilisation of the macro-economy.”
“[This measure] is a direct and highly effective relief measure for all types of market actors, and a key measure for stabilisation of growth and maintaining employment,” said the State Council. “It also vigorously advances reform of the VAT system.”
“Tax refunds and cuts are a key measure for stabilising the macro-economy this year,” said Xu Hongcai (许宏才), deputy-head of the Ministry of Finance (MOF), at a press conference held by the State Council on 23 March.
“This year tax refunds and cuts will total approximately 2.5 trillion yuan, with large-scale refunds serving as a key measure, and full-year tax refunds amounting to around 1.5 trillion yuan.”
Xu said that the tax refund measures would focus specifically on three areas:
- Preferential support for micro-and-small enterprises, and expanding the vigour of tax refund policies for micro-and-small enterprises.
- Focused support for sectors such as manufacturing, and comprehensive resolution of the tax refund problems of sectors such as manufacturing.
- The central government providing fiscal guarantees, and ensuring that tax refunds are promptly paid.