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China's Fiscal Reform Looks Beyond WTO
As the Chinese government is reforming its fiscal system to increase revenue and reduce expenditure, experts in Beijing believe that the State treasury is capable of making ends meet after the country's accession to the World Trade Organization.
Today's Business Weekly of China Daily quoted Liu Zuo, an expert with the Taxation Science Research Institute under the State Administration of Taxation, as saying this.
According to the Finance Minister Xiang Huaicheng, China will reform the tax system in the coming years. Instead of taxing production, China will target consumption in order to gradually shift its value-added tax levy.
The country will adopt a unified income tax system for Chinese and foreign-funded enterprises instead of its current preferential policies, which aims to serve the government's goal of increasing the amount of foreign capital of the country, said the paper.
The anticipated tax reform is also expected to improve the country's personal income tax system and adopt an inheritance tax to narrow the gap between the rich and the poor.
China will be able to generate more tax revenue after its WTO accession because the country's economy will develop faster and people's income will rise, said Li Jingwen, an expert with the Chinese Academy of Social Sciences.
China's incorporation into the world economy will allow more foreign companies to invest in the country, which means more company and individual income taxes, Li said.
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