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Consumption tax revenues might be shared by the central government and local governments

(People's Daily Online)    17:16, February 18, 2016

Apart from the state tax bureaus, local tax bureaus may be able to collect consumption tax in the future, according to the reporters of the Economic Information Daily. As for the tax revenue from taxable items belongs to the central government, the state tax bureau should levy consumption tax; and the rest should be collected by the local tax bureaus.

Experts hold that this move enhances the autonomy of local tax bureaus to a certain degree. If the local tax bureaus have the right to levy consumption tax on certain taxable items, the collection and administration of consumption tax can be further strengthened and at the same time, local governments will attach more importance to improving the consumption environment and increasing consumption capacities in the local area.

The reform might be carried out after the task of replacing the business tax with a value-added tax and giving reasonable adjustment to the tax revenue sharing arrangement between the central government and local governments is completed, according to the reporter from the Economic Information Daily.

For the time being, the consumption tax revenue belongs to the central government and the consumption taxes are collected by the state tax bureaus. 

In 2015, the revenue from consumption taxes exceeded more than 1 trillion yuan and the consumption tax becomes the fourth largest tax. 

Quite a few experts hold that the reform of the consumption tax plays an important role in adjusting the sharing arrangement between the central government and the local governments through the fiscal and tax reform.

(For the latest China news, Please follow People's Daily on Twitter and Facebook)(Editor:Ma Xiaochun,Bianji)

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