The Covid-19 pandemic is taking a toll on Chinese government coffers, dragging down fiscal revenues in this year’s first two months by the most in 11 years as drastic measures to contain the disease put business activities on hold, reported Caixin.
Revenues of China’s central and local governments in January and February totaled RMB 3.5 trillion ($493 billion), down 9.9% from the same period a year ago in the steepest drop since February 2009, data from the Ministry of Finance showed. In February alone, national fiscal income dropped 21.4% from the year earlier, the biggest monthly drop since 1996 when data was first recorded.
Government spending also plunged 2.9% in the first two months as social and economic activities halted, even with a 22.7% surge in outlays for public health.
Tax revenue in the first two months declined 11.2% to RMB 3.1 trillion, while nontax revenue grew 1.7% to RMB 405.7 billion, the finance ministry said. Tax income from residential services fell 41.6% and from transportation 37.3%.