As tax and fee cuts announced in March hit China’s fiscal revenue growth, some local governments are reporting higher-than-usual revenues from nontax sources, reported Caixin.
Southwest China’s Guangxi Zhuang autonomous region has beefed up its revenues by selling off idle assets such as factories and land, said a regional finance official. In addition, the central government collected RMB 168.5 billion ($24.5 billion) more from SOE profits in the first half of 2019 than during the equivalent period last year, accounting for 62% of the country’s nontax revenue growth, according to the Ministry of Finance.
Despite an uptick in June, year-on-year growth in China’s fiscal revenue has slowed in recent months as tax cuts have taken effect and downward pressure on economic growth has risen.
In the first half of 2019, tax revenue rose by just 0.4% to RMB 9.24 trillion ($1.34 trillion), down from a 13.9% increase during H1 last year as economic growth slowed and the government rolled out a program to slash taxes and fees by almost RMB 2 trillion, on top of the RMB 1.3 trillion of reductions in 2018.