Date
20 October 2017
Finance Minister Lou Jiwei says the VAT scheme will soon cover other sectors such as construction, real estate, finance and living services. Photo: Bloomberg
Finance Minister Lou Jiwei says the VAT scheme will soon cover other sectors such as construction, real estate, finance and living services. Photo: Bloomberg

China to further expand VAT reform

China will expand its value-added tax (VAT) program to cover more sectors, and strive to complete the reform by the end of 2015, the official Xinhua News Agency reported on Friday, citing Finance Minister Lou Jiwei.

Lou said the scheme, aimed at reducing companies’ tax burden and curbing double taxation, will also cover construction, real estate, finance and living services sectors.

Following regional experiments since 2012, the government rolled out the VAT reform in transportation and several service sectors throughout the country on Aug. 1, 2013. It expanded the program to the railway transportation and postal service sectors from Jan. 1, 2014.

The government will also speed up the reform of coal resources tax, and promote a price-based levy that will eventually be expanded to cover other resources such as water, forestry and grassland, the report said.

Meanwhile, Lou said overall risks arising from local government-backed financing facilities are under control. He said the country will expand a pilot scheme allowing local governments to issue debts on their own, and consider a credit rating system for the program.

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