Tax and Fee Reduction Policies Fully Implemented in Jiaxing to Support High-Quality Development
“The price of all products will be reduced since April 1, 2019 in reply to the value-added rate reduction. As to RT-MART, the sales prices of its products in terms of tax reform will be reduced in accordance with new tax rates.” In recent days the price reduction advertisements have been hung up around Xiuzhou-based RT-MART. As is known, the value-added tax reform has been implemented since this April 1 and the tax rate has gone down to 13% from 16% in manufacturing industry, etc.
Governments plan to live a “hard life”.
The reporter learns from Jiaxing Financial Bureau and Jiaxing Tax Bureau, the tax and fee reduction is the most important issue of positive fiscal policies this year. The authorities concerned will continue to implement generally preferential and structural tax reduction to lighten tax burdens of manufacturing industries and small and micro enterprises to increase their incomes. On the premise of meeting the requirements of public service expenditures and taking all factors into consideration, expenditures on major issues will be expanded and those on general issues will be cut down.
“Governments must hold in mind the idea of living a ‘hard life’, strictly control expenditures on official entertainment, vehicle purchase and outbound travel. In principle, these expenditures will be decreased with a view to spending more fiscal revenues on the most important issues. In 2019, fiscal expenditures on general issues will decrease by 5%.” said an official from Jiaxing Financial Bureau. Governments’ ‘hard life’ is an effective measure to optimize fiscal expenditure structure. Measures will be made to strengthen fiscal budget implementation, control and decrease additional budgets in the process of implementing the set budget.
Governments’ living a hard life not only reduces regular expenditures and but also enhances capital allocation efficiency. With the improvement of the capital security mechanism for major government invested projects of Jiaxing, the overall fiscal work mechanism will be able to settle the problem of decentralizing funds to different issues, therefore financial service will be more accurate, intensive and forceful. For example, 50% of newly added general public budgets of a year will be spent on major government invested projects to push ahead with the campaigns “The Year for Making Progress in Investment Projects” and “The Year for Building a Good Business Environment”. This year fiscal expenditures will mainly flow to education, social insurance, employment, health etc. At the beginning of this year, fiscal expenditures on people’s livelihood reached over 49.9 billion yuan to support the construction of “Intelligent and Secure Residential Quarters”, kindergartens and preliminary schools to make people obtain more and feel more satisfactory.
Enterprises Live a “happy life”
Government’s “hard life” saves more funds for people and enterprises to be more confident to live a “happy life”.
On January 23, 2019, “A Notice on Reducing Taxes of Small and Micro Enterprises of Zhejiang” issued by Zhejiang Financial Department and Zhejiang Taxation Administration. Zhejiang is not only the earliest province in China to specify and announce local taxation reduction degree, but also the largest province in tax reduction scale.
According to the tax reduction plan, it is estimated 19.5-billion-yuan taxes will be cut for small and micro enterprises in 2019. For example, efforts will be made to ensure that small and micro enterprises can enjoy preferential policies in a more sustainable and convenient way to decrease more corporate income taxes in a larger scope. The tax exemption standard for smaller taxers will be increased to 100,000-yuan sales per month from 30,000-yuan sales per month. As to sci-tech enterprises, their taxation exemption standard are also increased. 50% tax amount payable will be exempted directly from six local taxation rates and two additional taxation rates.
In addition, deepening the value-added reform is also a core content for this year’s tax and fee reduction. According to new policies, the taxation rate for manufacturing industries will be reduced to 13% from 16% and that of transport and construction industries will be reduced to 9% from 10% to ensure the remarkable tax reduction in main industries. “Although the taxation rate 6% keeps the same, the taxation burdens of all industries will be eased supported by a series of favorable supporting measures.” said an official from Jiaxing Tax Bureau.
Actually, the value-added tax reform has always been a main measure to implement tax and fee reduction policies. Last year, 21-billion-yuan taxes were exempted from enterprises, a growth of 10.1% year on year. Such reforms were implemented in the value-added tax like reducing the taxation rate of manufacturing industries, unifying taxation standards for small taxpayers and refunding excess VAT paid to support the development of real economy.
In fee reduction, all financial departments strictly implemented the policies on reducing and adjusting administrative fees and government funds. Since 2018, work has been done to cancel the fees for pollution discharges and first application for ID cards, reduced employment security fund standards for the disabled and decreased once again the standard for collecting construction funds of national major water conservation projects.
As to the widely attentive payment to social insurance programs, measures will be made to reduce premium rates of unemployment insurances and work-related injury insurances in different stages, offer more subsidies to labor-intensive enterprises, return social insurance premiums to enterprises in difficulties and accelerate provincial-level endowment insurance reform, and transfer partial state-owned capitals to social insurance funds to keep social funds sustainable and benefit enterprises and their employees.
In response to serving enterprises, people and grassroots units (Three Servings), finance and taxation departments positively offered services, published policies, knew well enterprises’ demands and settled their problems, and much progress has been made in reforming finance and taxation management, budgeting and improving governments’ images. “We will enrich the campaign ‘providing at least one door-to-door service for an enterprise’ by means of “Three Servings”, help enterprises understand the policies on tax and fee reduction, familiarize them with these preferential policies, expand the influence of these policies and put them into practice.” said an official from Jiaxing Finance Bureau.