Trade spat downside to be eased with fiscal measures
China will push forward a proactive fiscal policy, including further tax cuts, and boost government expenditures to ease downward economic pressure amid Sino-US trade tensions, Finance Minister Liu Kun told China Daily in an interview on Thursday.
The proactive policy stance, however, does not mean massive economic stimulus measures, he said.
“We are studying measures to further cut taxes and reduce fees, aiming to ease the burden in the corporate sector,” Liu said. “A special deduction plan for personal income tax is also being researched to increase individual incomes and boost consumption.”
The total tax cut this year is expected to exceed 1.3 trillion yuan ($189 billion), higher than the 1.1 trillion yuan tax cut target set at the beginning of this year, the minister said.
Additional government spending, in the meantime, will support key construction projects and improve people’s livelihoods, although fiscal income growth is likely to slow down in the second half of this year, Liu said.