Tax revenues grow alongside economy

High economic growth helped shore up China's coffers. Tax revenue increased by 21.9% in 2006 to US$482 billion, the central government announced. Xie Xuren, commissioner of the State Administration of Taxation, said revenues jumped because of higher earnings at state-owned firms, growing economic activity in the coastal regions, increased securities trading and improved tax collection, the South China Morning Post reported. Xie said the tax revenues would be partly used to narrow the gap between China's urban rich and rural poor, a source of concern for the central government. High growth rates are driving up tax revenues in China. The country's nominal gross domestic product grew 12.6% last year, while real GDP grew by 10.7%, according to official figures.