The Ministry of Finance issued the Report on the Implementation of Fiscal Policy in China in 2023.
Cctv newsAccording to the website of the Ministry of Finance, the Ministry of Finance issued the Report on the Implementation of Fiscal Policy in China in 2023. Details are as follows:
Summarize
The year 2023 is the first year to fully implement the spirit of the 20th National Congress of the Communist Party of China, and it is also a year of economic recovery and development after three years of epidemic prevention and control in COVID-19. Under the strong leadership of the CPC Central Committee with the Supreme Leader as the core, all localities and departments thoroughly implemented the spirit of the 20th Party Congress and the Second Plenary Session of the 20th CPC Central Committee, adhered to the general tone of striving for progress while maintaining stability in accordance with the decision-making arrangements of the CPC Central Committee and the State Council, comprehensively deepened reform and opening up, intensified macro-control, focused on expanding domestic demand, optimizing the structure, boosting confidence, and preventing and defusing risks. China’s economy rebounded to a good and high-quality development, and made solid progress in building a socialist modern country in an all-round way.
The financial departments at all levels adhere to the guidance of the Supreme Leader’s Socialism with Chinese characteristics Thought in the New Era, follow the decision-making arrangements of the CPC Central Committee and the State Council, intensify efforts to improve efficiency, implement a proactive fiscal policy, strengthen financial management supervision, and combine macro-control, focus on expanding domestic demand, foster new development momentum, and prevent and resolve risks, thus effectively promoting the sound and high-quality development of China’s economic operation.
First, support the development of business entities. At the beginning of the year, we will clearly continue and optimize some tax and fee policies, and in the second half of the year, according to the changes in the economic situation, we will continue, optimize and improve a number of expired tax and fee policies to further reduce the tax burden of business entities and accurately support the high-quality development of the real economy such as manufacturing. In the whole year, the new tax reduction and fee reduction and tax refund deferred fees exceeded 2.2 trillion yuan. We will promote government financing guarantee institutions at all levels to increase credit support for small and micro enterprises. In the whole year, the scale of new re-guarantee cooperation business of the national financing guarantee fund was 1.31 trillion yuan, up 8.67% year-on-year. We will carry out pilot projects to transform small and medium-sized enterprises into digital cities, continue to do a good job in financial awards and subsidies for specialized and innovative small and medium-sized enterprises, actively play the leading role of government investment funds, and continuously enhance the momentum of enterprise innovation and development.
The second is to focus on expanding effective domestic demand. We will continue and optimize the vehicle purchase tax reduction and exemption policy for new energy vehicles, and support the construction and operation of charging and replacing infrastructure. The annual sales of new energy vehicles increased by 37.9%. We will introduce preferential tax and fee policies to support the development of the national film industry and promote the consumption of the service industry. Efforts will be made to build the circulation network of key cities, build the rural commercial and trade circulation system, and newly support 10 cities to implement the national comprehensive freight hub to supplement the chain and strengthen the chain, and continuously smooth the logistics network. Newly supported 15 cities to carry out demonstration of sponge city construction, improve urban drainage and waterlogging prevention capacity, and enhance urban resilience. We will speed up the issuance and use of local government special bonds. A total of 3.7 trillion yuan of new special bonds were issued for project construction throughout the year, and more than 35,000 projects were supported, which led to the expansion of effective investment.
The third is to speed up the construction of a modern industrial system. Increase investment in basic research and fully guarantee key core technologies. Increase the pre-tax deduction ratio of R&D expenses of enterprises in qualified industries from 75% to 100%, and implement it as an institutional arrangement for a long time to guide manufacturing enterprises and other enterprises to increase R&D investment. Give play to the role of relevant special funds in the manufacturing sector and focus on supporting the high-quality development of the manufacturing industry. We will introduce a policy of adding and deducting value-added tax for advanced manufacturing enterprises to further reduce the tax burden of enterprises in relevant key industrial chains.
The fourth is to continuously strengthen the protection of people’s livelihood. We will continue to reduce unemployment insurance and industrial injury insurance rates, continue to implement the steady return of unemployment insurance, optimize and adjust the one-time employment subsidy policy, and promote the overall improvement of the employment situation. The average unemployment rate in urban surveys in the whole year decreased by 0.4 percentage points over the previous year. We will improve the funding guarantee mechanism for compulsory education, continue to implement the policy of interest-free and deferred repayment of principal for national student loans, and substantially increase the upper limit of the amount of national student loans for junior college students and graduate students. We will raise the funds for basic public health services and the per capita financial subsidy standard for urban and rural residents’ basic medical insurance, steadily implement the national overall planning of basic old-age insurance for enterprise employees, and timely release 156.683 billion yuan of relief subsidies for people in need, so as to further secure social security. An additional 1 trillion yuan of treasury bonds will be issued specifically for post-disaster recovery and reconstruction and to enhance disaster prevention, mitigation and relief capabilities.
The fifth is to comprehensively promote rural revitalization. We will strengthen the stable production and supply of grain and important agricultural products, build, transform and upgrade high-standard farmland, grant a one-time subsidy of 10 billion yuan to actual grain farmers, improve the subsidy policy for corn and soybean producers, and expand the implementation scope of full cost insurance and planting income insurance for the three major grain crops. The central government’s convergence will further increase the subsidy funds for rural revitalization, giving priority to the development of rich agricultural industries in the agricultural belt. We will implement a new round of policies to develop a new rural collective economy, carry out a demonstration of centralized and contiguous protection and utilization of traditional villages, and further promote comprehensive rural reform.
Sixth, we will continue to strengthen the construction of ecological civilization. Adhere to the coordinated promotion of carbon reduction, pollution reduction, green expansion and growth, fight the defense of blue sky, clear water and pure land, implement and improve the subsidy policy for clean heating in winter in northern China, include 12 cities in the pilot area of rural black and odorous water treatment, increase the construction of horizontal ecological compensation mechanism in river basins, strengthen the management and protection of ecosystems, support the development of seven integrated protection and restoration projects of mountains, rivers, lakes, grass and sand, and enhance the diversity and stability of important ecosystems such as forests, grasses, mines and oceans.
First, the financial operation is generally stable and the budget implementation is good.
Benefiting from the economic recovery, coupled with the implementation of large-scale value-added tax rebate in 2022 to lower the base, fiscal revenue resumed growth in 2023; We maintained necessary expenditures, strengthened financial support for major national strategic tasks, and strengthened support for key areas such as tackling key scientific and technological problems, rural revitalization, and ecological and environmental protection. The annual budget implementation was generally good.
(1) The economic recovery is improving, and the fiscal revenue has resumed growth.
In 2023, the national general public budget revenue was 21,678.4 billion yuan, a year-on-year increase of 6.4%. Among them, the central general public budget revenue was 9,956.6 billion yuan, a year-on-year increase of 4.9%; The local general public budget revenue at this level was 11,721.8 billion yuan, a year-on-year increase of 7.8%. In terms of regions, the income of the eastern, central, western and northeastern regions increased by 6.7%, 6.9%, 10.7% and 12% respectively, and the fiscal revenue of all 31 provinces in China achieved positive growth.
In terms of tax revenue, in 2023, the national tax revenue was 18,112.9 billion yuan, up 8.7% year-on-year. Among them, the domestic value-added tax was 6,933.2 billion yuan, up 42.3% year-on-year, mainly due to the large amount of tax rebates left over last year and the low base. The domestic consumption tax was 1,611.8 billion yuan, down 3.5% year-on-year. Corporate income tax was 4,109.8 billion yuan, down 5.9% year-on-year. Personal income tax was 1,477.5 billion yuan, a year-on-year decrease of 1%. Stamp duty was 378.4 billion yuan, a year-on-year decrease of 13.8%. In terms of non-tax revenue, in 2023, the national non-tax revenue was 3,565.5 billion yuan, down 3.7% year-on-year.
(two) to maintain the necessary expenditure intensity, key areas have been effectively guaranteed.
Financial departments at all levels should strengthen the overall planning of financial funds, optimize the combination of financial deficits, special debts, interest subsidies and other tools, and maintain the necessary expenditure intensity. At the beginning of 2023, the fiscal deficit ratio will be arranged at 3%. In order to support post-disaster recovery and reconstruction, and enhance the ability of disaster prevention, mitigation and relief, the National People’s Congress Standing Committee (NPCSC) approved the issuance of 1 trillion yuan of treasury bonds in the fourth quarter, all of which were arranged to local governments through transfer payments. In the whole year, the national general public budget expenditure was 27,457.4 billion yuan, an increase of 5.4%. Among them, the central general public budget expenditure at this level was 3,821.9 billion yuan, an increase of 7.4%; The local general public budget expenditure was 23,635.5 billion yuan, an increase of 5.1%. We will continue to optimize the expenditure structure, strengthen financial support for major national strategic tasks, and give strong support to key areas. Social security and employment expenditure increased by 8.9%, education expenditure by 4.5%, science and technology expenditure by 7.9%, agriculture, forestry and water expenditure by 6.5%, and urban and rural community expenditure by 5.7%.
(3) Firmly adhere to the concept of living a tight life and continuously improve the efficiency of financial resource allocation.
Taking the party and government organs to live a tight life as a long-term guiding principle of financial work runs through budget preparation, budget implementation, asset management, government procurement and other aspects. The central departments take the lead in living a tight life, strengthen the source control of budget preparation, strictly control general expenditures, strengthen the budget management of "three public funds" and reduce administrative operating costs. In 2023, the budget for the "three public" funds at the central level decreased by 20% compared with 2019. Strengthen the constraints of budget implementation, and solve the newly introduced policy of increasing expenditure and additional budgetary matters in accordance with the relevant provisions of the budget law. Evaluate the tight life of the central departments on a quarterly basis, link the evaluation results with the departmental budget arrangements, and promote the departments to be careful and thrifty. We will continue to urge local governments to strictly implement the requirements for a tight life, strengthen the management of funds and projects, strengthen daily supervision, and promote the standardized and efficient use of financial funds.
Two, strengthen the supply of fiscal and taxation policies, help the development of business entities.
Strengthen the study of countercyclical adjustment and policy reserve, continue, optimize, improve and implement the policy of tax reduction and fee reduction, innovate and improve the assistance measures, support the development of business entities to help them out, and promote the sustained recovery of the national economy and the overall recovery. In the whole year, the new tax reduction and fee reduction and tax refund deferred fees exceeded 2.2 trillion yuan, of which the new tax reduction and fee reduction was about 1.57 trillion yuan, and the tax refund was about 650 billion yuan. Small and medium-sized enterprises and manufacturing industries benefited the most.
(1) Optimize and improve the tax reduction and fee reduction policies.
First, make clear the follow-up arrangements for the preferential policies for expired taxes and fees as soon as possible. On the basis of comprehensive evaluation, we will continue, optimize and improve more than 70 preferential tax and fee policies in batches, and grasp the timing, intensity and rhythm. Most of the policies will continue directly until the end of 2027. We will continue to implement the preferential policy of reducing or exempting small-scale taxpayers’ value-added tax, expand the scope of individual industrial and commercial households enjoying a 50% reduction in personal income tax, uniformly levy "six taxes and two fees" on small and micro enterprises, and levy a 50% reduction in urban land use tax on the land used for bulk commodity storage facilities of logistics enterprises. We will focus on improving the quality of supply and expanding effective demand, focusing on supporting the development of small and micro enterprises and individual industrial and commercial households, strengthening and improving the real economy, promoting income and consumption to protect people’s livelihood, supporting high-level scientific and technological self-reliance, and supporting the stable
The second is to accurately implement the new preferential tax and fee policies. Focus on specific areas and key links, study and introduce new tax reduction policies in time, including increasing the proportion of R&D expenses plus deduction for integrated circuit and industrial mother machine enterprises, and enhancing the ability of scientific and technological innovation; Improve the special additional deduction standard of personal income tax for infant care, children’s education and support for the elderly under 3 years old, and further reduce the burden of family childbearing and support for the elderly; Give preferential taxes and fees to the construction transactions of affordable housing projects to support the protection and improvement of people’s livelihood.
(2) The employment policy of stabilizing posts has improved efficiency and strength.
The first is to strengthen financial support. In 2023, the central government issued an employment subsidy fund budget of 66.743 billion yuan, an increase of 8.1% over the previous year. Guide local governments to make good use of employment subsidy funds, unemployment insurance funds, vocational skills upgrading action funds, and support the implementation of various employment and entrepreneurship support policies. We will continue to implement demonstration projects to improve the public employment service capacity, so as to promote the overall improvement of the national employment service capacity.
The second is to increase efforts to help enterprises stabilize their posts. We will continue to reduce unemployment insurance and work-related injury insurance rates, continue to implement phased job stabilization policies such as the return of unemployment insurance and the early payment of employment trainee subsidies, and support business entities to solve problems and stabilize their jobs.
The third is to focus on the employment of key groups. Put the promotion of employment of key groups such as college graduates in a more prominent position, optimize and adjust the policies of one-time employment subsidy and one-time post expansion subsidy, continuously increase assistance and broaden employment channels. We will promote the stabilization and expansion of the scale of migrant workers, especially those who are out of poverty, strengthen employment assistance for disadvantaged groups such as the disabled and family members with zero employment, and improve the employment assistance mechanism.
The fourth is to strengthen vocational skills training. Relax the conditions for applying for skills upgrading subsidies, carry out the construction of national-level high-skilled personnel training bases and skill master studios, improve the skill level of workers, and alleviate structural employment contradictions.
The fifth is to support the incremental expansion of entrepreneurial guarantee loans. We will increase the interest subsidy for business guarantee loans, and allocate 7.948 billion yuan of interest subsidy and bonus funds for business guarantee loans throughout the year. The Measures for the Administration of Special Funds for Development in inclusive finance were revised and promulgated, which raised the upper limit of individual and small and micro enterprises’ entrepreneurial guarantee loans to 300,000 yuan and 4 million yuan respectively, and continuously increased financial support for entrepreneurial employment.
(3) Financing support continued to increase.
First, the incentive and compensation policy for financing guarantee fee reduction for small and micro enterprises was implemented in depth. In 2023, the central government issued 3 billion yuan of bonus funds to guide local governments to expand the scale of financing guarantee business for small and micro enterprises and reduce the financing guarantee rate for small and micro enterprises. Compared with before the implementation of the policy (2017), the number of financing guarantee businesses of small and micro enterprises increased by 245%, the annualized guarantee amount increased by 119%, and the annualized guarantee rate decreased by 97 basis points.
Second, the equity financing of small and medium-sized enterprises has been increasing. Give full play to the role of the National Small and Medium-sized Enterprise Development Fund (hereinafter referred to as the Small and Medium-sized Fund), and drive social capital to jointly support the innovative development of growing small and medium-sized enterprises in seed stage and initial stage. By the end of 2023, small and medium-sized funds had invested 36 Zhi Zi funds and 3 direct investment projects. Among them, the total subscription scale of 36 Zhi Zi Fund is about 98.8 billion yuan, and the subscription of small and medium-sized funds is about 26.94 billion yuan. The central financial funds are amplified by the mother and child funds, and more than 8 times of social funds are mobilized to jointly carry out equity investment in small and medium-sized enterprises. The sub-fund has completed more than 1,400 investment projects with a total investment of 47.8 billion yuan. Among them, the amount of investment in small and medium-sized enterprises in seed stage and initial stage accounted for 71.9%.
Third, the role of government financing guarantee re-guarantee institutions at all levels has been effectively played. We will steadily expand the re-guarantee business scale of the national financing guarantee fund. In 2023, the re-guarantee cooperation business scale of the national financing guarantee fund reached 1.31 trillion yuan, an increase of 8.67% year-on-year. Improve the government financing guarantee system. The State Financing Guarantee Fund cooperates with all 35 provincial re-guarantee institutions and more than 1,500 city and county guarantee institutions nationwide, covering 2,602 counties (districts). Reduce the financing cost of small and micro enterprises, and the average guarantee rate and loan interest rate of re-guarantee cooperation business will decrease in 2023.
(D) The function of government procurement policy is better played.
The first is to support industrial growth. Accelerate the construction of a government procurement support innovation policy system in line with international rules, formulate clear government procurement demand standards for seven types of products, including desktop computers, portable computers, integrated computers, workstations, general-purpose servers, operating systems and databases, and guide the innovative development of the information industry.
The second is to promote green development. Improve the standard system of government green procurement demand, and issue the "Implementation Guide for Government Procurement Supporting Green Building Materials to Promote Building Quality" to guide relevant cities to implement the policy requirements.
The third is to support small and medium-sized enterprises. Guide all localities and departments to strictly implement preferential policies and measures for reserved shares and price evaluation, and encourage large enterprises and small and medium-sized enterprises to form consortia or subcontract to further expand the contract share of small and medium-sized enterprises. The policy period of increasing the reserved share of government procurement projects for SMEs to more than 40% will be extended to the end of 2025. Provide commercial banks with government procurement information of central departments in a timely manner to facilitate the financing of government procurement for small and medium-sized enterprises.
The fourth is to help rural revitalization. Organize the central and local budget units to fill in the reserved share in 2023 and purchase agricultural and sideline products in poverty-stricken areas. By the end of 2023, budget units at all levels had purchased 10.6 billion yuan of agricultural and sideline products in poverty-stricken areas through the "832 platform".
Third, strengthen the guidance of innovation and promote positive progress in the construction of modern industrial system.
In-depth implementation of the innovation-driven development strategy, adhere to the priority protection of science and technology as the key areas of fiscal expenditure, and make overall use of policy tools such as financial subsidies, loan interest subsidies, tax incentives, etc., to enhance the toughness and safety level of the industrial chain, promote the high-quality development of the manufacturing industry, and significantly accelerate the construction of a modern industrial system.
(a) vigorously support scientific and technological innovation, high-level science and technology self-reliance and self-improvement to take steady steps.
First, investment in basic research continued to increase. In 2023, the central government spent 86.65 billion yuan on basic research, an increase of 6.6% over the previous year. We will improve the basic research investment mechanism combining competitive support with stable support, innovate scientific research funding methods, and support China Academy of Sciences to carry out pilot projects of stable support for outstanding young teams in basic research. Improve the diversified investment system of basic research and guide the whole society to increase investment.
Second, major national science and technology projects were implemented steadily. We will improve the financial fund management mechanism that adapts to the new national system of tackling key core technologies, fully guarantee the fund demand for tackling key core technologies, and support the layout and implementation of a number of strategic, overall and forward-looking major national science and technology projects. Effectively guarantee the organization and implementation of major projects in 2030, accelerate the arrangement of major scientific and technological projects, and promote China’s important achievements in artificial intelligence, quantum computing, brain science and other research fields.
Third, the national strategic scientific and technological strength has been further strengthened. Ensure the construction and development of national laboratories, increase stable support for central-level scientific research institutes, and promote the improvement of scientific research capabilities to undertake major national strategic tasks. Support national laboratories, national scientific research institutions, high-level research universities, and leading enterprises in science and technology to innovate together and form a joint force to enhance the overall efficiency of the national innovation system.
Fourth, new progress has been made in the construction of high-level scientific and technological talents. Support the training of more strategic scientists, first-class scientific and technological leaders and innovative teams around the major needs of the country. Promote the natural science foundation to move forward to the funding port, and encourage outstanding undergraduate students to undertake scientific fund projects.
(2) Actively promote the high-quality development of the manufacturing industry and continuously optimize the economic structure.
The first is to promote the upgrading of industrial basic capabilities and the optimization and upgrading of industrial chains. Through special funds for manufacturing, we will focus on key strategic industrial chains, support systematic research, accelerate the promotion of key technologies and key industries to make up for shortcomings, and improve the resilience and safety level of the industrial chain supply chain. Continue to implement the insurance compensation policy for the first (set) of major technical equipment and key new materials, and promote the popularization and application of innovative products of major technical equipment and new materials. Give play to the role of government investment funds in the manufacturing sector, guide social capital to increase investment in key areas of manufacturing, and promote industrial transformation and upgrading.
The second is to improve the tax policy that encourages enterprises to develop and innovate. The policy of adding and deducting value-added tax for advanced manufacturing enterprises will be introduced, and the proportion of adding and deducting R&D expenses for enterprises in integrated circuits and industrial machine tools industries will be increased to 120%, further reducing the tax burden of enterprises in relevant key industrial chains.
The third is to promote the digital transformation of SMEs. Organize and carry out pilot projects for small and medium-sized enterprises to transform into digital cities, and the central government will give a fixed reward of 1-150 million yuan to the pilot cities. In 2023, the pilot selection of the first batch of 30 small and medium-sized enterprises in digital transformation cities will be completed, and 3.01 billion yuan will be awarded to support the pilot cities to promote the deep integration of the digital economy and the real economy.
The fourth is to promote the high-quality development of specialized and innovative small and medium-sized enterprises. The central government allocated 1.27 billion yuan to support the high-quality development of specialized and innovative small and medium-sized enterprises. By the end of 2023, it had supported the high-quality development of 1,922 national key "little giant" enterprises, and promoted the cultivation of more than 12,000 national "little giant" enterprises and more than 100,000 provincial-level specialized and innovative enterprises.
Fourth, actively promote consumption and expand investment, and domestic demand will continue to recover and expand steadily.
Adhere to the strategic basis of expanding domestic demand, make overall plans to promote consumption and expand investment, and comprehensively use tax incentives, special funds, government bonds and other policy tools for production, circulation and consumption to promote consumption to show a good recovery trend, promote the expansion of effective investment, and promote the formation of a virtuous circle of mutual promotion between consumption and investment.
(1) Implement and improve fiscal and taxation policies and measures to promote the rapid recovery of household consumption.
First, continue and optimize the vehicle purchase tax reduction and exemption policy for new energy vehicles. Extend the vehicle purchase tax reduction and exemption policy for new energy vehicles to the end of 2027, and set tax reduction and exemption limits to support the stabilization and expansion of new energy vehicle consumption. In 2023, the sales volume of new energy vehicles reached 9.495 million, a year-on-year increase of 37.9%.
Second, special funds for the development of the national film industry will be exempted in stages. It is clear that from May 1, 2023 to October 31, 2023, the special funds for the development of the national film industry will be exempted. The exemption policy covers the three major periods of May Day, summer vacation and National Day, which effectively boosts industry confidence and helps the recovery of consumption.
Third, in-depth support for all localities to carry out county-level commercial construction actions. The central government allocated 4.24 billion yuan for the development of the service industry, continued to support the provinces (autonomous regions and municipalities) to carry out in-depth county-level commercial construction, and tilted to the weak areas in the central and western regions, guiding the localities to focus on the county-level rural commercial network system and rural logistics distribution, and speeding up the completion of the shortcomings of rural commercial facilities. In 2023, 1,044 county-level comprehensive business service centers, 4,195 township-level business centers and 45,353 village-level convenience stores were newly built and renovated. The retail sales of rural consumer goods reached 6.4 trillion yuan, up 8% year-on-year, and the growth rate was 0.9 percentage points faster than that of cities and towns.
(2) Give play to the leading role of government investment and promote the continuous optimization of investment quality structure.
In 2023, the amount of local government special bonds will be increased by 3.8 trillion yuan, giving priority to supporting projects with high maturity and projects under construction. Appropriately expand the investment scope of special bonds and the scope of project capital, include the transformation of villages in cities, 5G integration facilities, etc., and include heating and gas supply as the scope of project capital, encourage and attract social capital to participate, and promote a number of major projects such as transportation, water conservancy and energy that are beneficial to the present and the long term. Supervise and guide all localities to speed up the issuance and use, and give full play to the benefits of bond funds as soon as possible. At the same time, some new local government debt limits in 2024 will be issued in advance to support major project construction, promote the formation of physical workload, and give full play to the role of local government bonds in stimulating the economy.
Five, strengthen the people’s livelihood security, and strive to do a good job in people’s livelihood.
Adhere to the promotion of people’s livelihood and well-being in high-quality development, continuously increase investment in people’s livelihood, focus on solving the urgent problems of the people, and continuously improve the level of basic medical care, education, basic old-age care, and promote the continuous improvement of people’s lives.
(1) The construction of a high-quality education system has been solidly promoted.
First, investment in education has grown steadily. We will implement the financial investment requirement of "one is generally not lower than the other, and the other two will only increase but not decrease". In 2023, the national general public budget expenditure on education will be 4,124.2 billion yuan, an increase of 4.5% over the previous year. From 2012 to 2022, the proportion of national fiscal education expenditure to GDP remained above 4% for 11 consecutive years. The allocation of funds focuses on compulsory education, the central and western regions, teachers and students, and efforts are made to fill the shortcomings and weaknesses in the field of education.
The second is to help education equity advance steadily. We will raise the benchmark quota of public funds per student in compulsory education schools, from 650 yuan to 720 yuan in primary schools and from 850 yuan to 940 yuan in junior high schools. Support the implementation of the student nutrition improvement plan, benefiting about 35 million rural students. Strengthen the inclusive development of preschool education and special education, increase the supply of inclusive preschool education resources, and improve the basic conditions for running special education schools. Continue to improve the basic conditions for running ordinary high schools in counties, eliminate "large classes" and speed up the filling of shortcomings in ordinary high schools in counties. The implementation of national scholarships, tuition-free (miscellaneous) subsidies and other student aid policies benefited about 100 million people. We raised the maximum loan amount of the national student loan by 4,000 yuan, reduced the interest rate of the national student loan by 30 basis points, and continued to implement the national student loan interest-free and principal deferred repayment policy, benefiting about 11 million people.
Third, the ability of high-quality development of educational services has been effectively improved. In six provinces, we will carry out a pilot project of differentiated per-student funding system for vocational education based on major categories, and promote the construction of high-level vocational schools and majors with China characteristics. Optimize the expenditure structure of central universities, give preferential support to the reform and development of high-level research universities and the training of high-level talents and talents in short supply, and speed up the construction of world-class universities and advantageous disciplines with China characteristics.
(2) The level of social security has been steadily improved.
First, the old-age security system has been gradually improved. We will steadily implement the national overall planning of endowment insurance, and adjust the funds of 271.6 billion yuan as a whole throughout the year, effectively solving the current gap of local funds. The basic old-age pension for retirees will be raised according to the national overall ratio of 3.8%, and the central government will issue about 1 trillion yuan of subsidy funds to support the timely and full payment of basic old-age insurance benefits in various places. We will implement tax incentives for individual pensions and support the trial implementation of the individual pension system in 36 regions.
Second, social assistance and social welfare protection are more powerful. The central government issued a subsidy of 156.683 billion yuan to help needy people, supporting all localities to make overall plans to do a good job in subsistence allowances, assistance and support for destitute people, temporary assistance, assistance for vagrants and beggars, basic living security for orphans, and basic old-age service assistance for the disabled elderly. At the same time, efforts will be made to promote the renovation of old-age service facilities in urban and rural communities, and support all localities to coordinate the rehabilitation and care of the disabled, as well as the renovation of dilapidated buildings and earthquake-resistant renovation of rural houses for key targets such as low-income groups in rural areas.
Third, the investment in preferential treatment and pensions continued to increase. We will continue to raise the standard of pensions and living allowances for special care recipients. In 2023, the central government issued a subsidy of 65.58 billion yuan for special care recipients to continuously improve their living standards. The central government allocated 2.38 billion yuan for medical security for the special care recipients, subsidizing their insurance contributions, hospitalization and outpatient expenses. Through the central special lottery public welfare fund to support some special care hospitals to purchase commonly used medical (rehabilitation) equipment, etc., to enhance their service capabilities and better meet the medical and support needs of disabled veterans and other special care recipients.
(3) flood control and disaster relief work has been fully guaranteed.
First, allocate the central natural disaster relief funds efficiently and quickly. A total of 22 rapid pre-allocation mechanisms were launched throughout the year, with pre-allocation first and liquidation later, and a total of 12.175 billion yuan of central natural disaster relief funds were issued to support the affected areas in coping with major natural disasters such as typhoons, earthquakes and floods.
Second, the issuance of treasury bonds to support post-disaster recovery and reconstruction and the improvement of disaster prevention, mitigation and relief capabilities. In the fourth quarter of 2023, 1 trillion yuan of government bonds will be issued, all of which will be arranged to local governments through transfer payments. The funds are mainly used in eight aspects, including: post-disaster recovery and reconstruction in North China, focusing on Beijing-Tianjin-Hebei, and improving disaster prevention and mitigation capabilities; Key flood control projects focusing on the northern areas such as Haihe River and Songhua River Basin; Natural disaster emergency capacity improvement project; Other key flood control projects; Irrigation district construction and renovation and key soil erosion control projects; Action to improve urban drainage and flood prevention capacity; Construction project of comprehensive prevention and control system for key natural disasters; Construction of high-standard farmland in northeast China and disaster-stricken areas of Beijing, Tianjin and Hebei.
The third is to actively carry out winter and spring relief work for the affected people. The winter and spring relief work was deployed 20 days earlier than in previous years, and 4.846 billion yuan of winter and spring relief funds were allocated to the severely affected areas such as North China, Northeast China and South China, and the key counties for rural revitalization, the original deep poverty areas of "three districts and three States" and the cold and cold areas, so as to ensure the warmth of the affected people for the winter.
The fourth is to strengthen the management of disaster relief materials reserves. Timely release the 452 million yuan central emergency rescue and relief materials reserve procurement plan, enrich the reserve inventory, and prepare for emergency relief.
(four) to help the overall improvement of health care.
The first is to promote the continuous improvement of public health service capacity. The per capita financial subsidy standard for basic public health service funds has been raised in 5 yuan, reaching 89 yuan per person per year. The central government issued 72.509 billion yuan of basic public health service subsidy funds to support local governments to provide basic public health services such as health management for key populations and "two cancers" examination for rural women for all urban and rural residents. We allocated 20.88 billion yuan for the prevention and control of major infectious diseases, and strengthened the prevention and control of major infectious diseases such as AIDS and tuberculosis. We will implement demonstration projects of public hospital reform and high-quality development, select 15 cities to further promote Sanming’s medical reform experience according to local conditions, and the central government will subsidize 500 million yuan for each demonstration project. Promote the inheritance, innovation and development of traditional Chinese medicine, select 15 cities to implement demonstration pilot projects of inheritance, innovation and development of traditional Chinese medicine, and the central government will subsidize 200 million yuan for each project. We will implement demonstration projects for the development of inclusive child care services, select 15 cities to explore the high-quality development path of inclusive child care services, and the central government will subsidize 100 million yuan for each demonstration project.
Second, the level of basic medical security has steadily improved. The central government issued 384 billion yuan of medical insurance subsidies for urban and rural residents to support the consolidation and improvement of the basic medical security level. We will continue to raise the per capita financial subsidy standard for basic medical insurance for urban and rural residents, reaching 640 yuan per person per year, an increase of 30 yuan over the previous year. The central government issued 29.7 billion yuan of subsidies for urban and rural medical assistance, supporting all localities to subsidize eligible needy people to participate in basic medical insurance, and subsidizing their unaffordable out-of-pocket medical expenses, thus consolidating the guarantee of medical assistance.
The third is to promote the improvement of the primary health care service system. Support all localities to consolidate the achievements of the reform of the basic drug system. Support projects such as capacity building of county medical and health institutions, capacity building of medical services in high-altitude areas, and capacity improvement of township hospitals in the western region to enhance the service capabilities of various medical and health institutions at all levels. Support the implementation of rural order-oriented free training of medical students, county and rural health personnel capacity improvement training and other talent training projects, and increase support for grassroots medical personnel training.
(5) Promoting the improvement of the public cultural service system.
Support local governments to implement the national guiding standards for basic public cultural services and local implementation standards, and implement projects such as public welfare performances of operas, household access to radio and television, and the construction of county-level emergency broadcasting systems in young and old areas and underdeveloped areas, so as to improve the digital service level of public culture. Promote public cultural service facilities such as museums, memorial halls, public libraries and art galleries to be open to the public free of charge according to regulations, and improve the efficiency of basic public cultural services. Support the training and selection of cultural workers for hard and remote areas and grassroots frontline, and accelerate the construction of grassroots cultural talents. We will continue to arrange the National Art Fund, the National Publishing Fund, special funds for fine films and special funds for the high-quality development of TV dramas, and support the launch of fine masterpieces. Support the successful hosting of the Hangzhou Asian Games and the Chengdu Universiade, and promote the extensive development of the national fitness campaign.
Six, accelerate the pace of agricultural and rural modernization, and promote the coordinated development of urban and rural areas.
Adhere to the priority development of agriculture and rural areas, actively play the role of financial functions, effectively strengthen investment guarantee, optimize policy supply, and provide strong support for promoting the comprehensive revitalization of rural areas and accelerating the modernization of agriculture and rural areas. Implement major national regional strategies, implement new urbanization strategies, and promote coordinated regional development to a higher level and higher quality.
(1) The ability to ensure food security has been continuously improved.
The first is to promote the in-depth implementation of the strategy of storing grain in the land. We will allocate 92 billion yuan to support the construction, renovation and upgrading of 80 million mu of high-standard farmland. Through the issuance of national debt in 2023, 125.365 billion yuan will be arranged to support the construction of high-standard farmland in the northeast region and the disaster-stricken areas of Beijing, Tianjin and Hebei. Support Jilin Province and Shandong Province to take the lead in carrying out the pilot project of comprehensive utilization of saline-alkali land. Strengthen the improvement of cultivated land quality and the protection and utilization of black land, and arrange 9.936 billion yuan to support the implementation of grain and bean rotation in Northeast China, Huang Huai Hai and other regions, and arrange 5 billion yuan to support the implementation of black land protection and utilization in Northeast China.
The second is to support the strong implementation of the strategy of storing grain in technology. We will arrange subsidies of 23.6 billion yuan for the purchase and application of agricultural machinery, mainly support the purchase and use of machines and tools needed for the production of important agricultural products such as grain, cotton and sugarcane, and accelerate the application of Beidou automatic driving system and intelligent terminals in agricultural production. Support the protection of germplasm resources, the determination of production performance and the promotion of major crop varieties. Subsidies will be given to provinces that undertake the task of demonstrating and promoting soybean and corn strip compound planting in key suitable areas. In Zhejiang, Anhui, Fujian and other 10 major double-cropping rice producing provinces, support individuals engaged in centralized seedling raising and agricultural production and operation organizations to build centralized seedling raising facilities.
Third, the supply system of important agricultural products has been further consolidated. Focusing on soybeans and corn, we will carry out nationwide actions to increase the unit yield of grain and oil scale growers. Support the relevant provinces to develop winter fallow fields and expand winter rapeseed, and complete the expansion of winter rapeseed by more than 10 million mu. Support Guangxi and Yunnan to expand the supply and promotion of sugarcane varieties and the level of hoist harvesting, and carry out the renewal and tending of low-yield and low-quality rubber plantations. Promote the improvement of the production capacity of dairy counties, and carry out alfalfa development actions, grain-to-feed, incremental upgrading of beef cattle and mutton sheep, improved seed subsidies, and beekeeping quality improvement actions.
Fourth, farmers’ enthusiasm for growing grain was effectively mobilized. We will steadily implement subsidies for the protection of cultivated land fertility. In 2023, the central government allocated 121.485 billion yuan, an increase of 1 billion yuan over the previous year. In the critical period of spring ploughing production, a one-time subsidy of 10 billion yuan will be given to the actual grain farmers. Support the appropriate increase in the minimum purchase price of wheat and early indica rice, improve the subsidy policy for corn and soybean producers, steadily implement the rice subsidy policy, increase the incentives for major grain-producing counties, and realize the "18 consecutive increases" in the amount of incentive funds.
Fifth, the ability of agricultural disaster prevention and mitigation and disaster relief has been effectively improved. We will implement subsidies for "one spray for three defenses" for wheat and "one spray for more promotion" for corn and soybeans. Timely release 8.403 billion yuan of disaster relief funds, and actively respond to natural disasters such as "rotten rain" in Henan and other places, severe floods in the northeast of North China, and local drought in the northwest. Effectively respond to the impact of floods in Haihe River basin, pre-allocate compensation funds for national flood storage and detention areas, and complete the compensation issued by capital settlement at the end of 2023, and give subsidies according to the proportion of 70% of the central finance.
Sixth, the insurance protection of bulk agricultural products has been increasing. We will extend the full cost insurance and planting income insurance for the three major grain crops to all major grain-producing counties in China. In the whole year, 47.766 billion yuan of agricultural insurance premium subsidies were allocated, a year-on-year increase of 10%, providing 4.5 trillion yuan of risk protection for about 160 million households. Implement a comprehensive insurance policy for natural rubber. Guiding China Agricultural Reinsurance Co., Ltd. to play the role of the main channel, the annual reinsurance business scale is about 28 billion yuan, providing reinsurance protection for agricultural production of about 1 trillion yuan.
(2) Rural revitalization was solidly promoted.
First, the results of poverty alleviation continued to consolidate and expand. The central government allocated 175 billion yuan to promote rural revitalization subsidy funds (hereinafter referred to as bridging funds), with the same caliber increasing by 10 billion yuan compared with the previous year, and continued to give preferential treatment to key areas such as national rural revitalization counties. The central special lottery public welfare fund of 2.4 billion yuan will be arranged to support 48 revolutionary old districts and counties to start the construction of rural revitalization demonstration zones and explore rural revitalization paths with the characteristics of old districts. Closely monitor the use of bridging funds, carry out performance evaluation of bridging funds and strengthen the application of results to improve the effectiveness of fund use.
Second, rural development and rural construction have been solidly promoted. We will allocate 11.438 billion yuan to support the creation of 50 national modern agricultural industrial parks, 40 industrial clusters with advantages and characteristics, and 200 towns with strong agricultural industries, and accelerate the construction of a modern rural industrial system. It is clear that a new round of policies to support the development of new rural collective economy will be implemented in 2023-2027, and about 100,000 villages will continue to be supported to develop new rural collective economy, of which 10.39 billion yuan will be specially arranged by the central government in 2023 to support the development of new rural collective economy in 20,000 villages nationwide. Support qualified rural collective economic organizations, farmers’ professional cooperatives, agricultural service specialized households, agricultural production service enterprises and supply and marketing cooperatives to carry out agricultural socialization services. Reward and supplement the construction of micro-and small-scale public welfare facilities in the "outdoor village" agreed by the villagers democratically, carry out pilot projects for the construction of red and beautiful villages, and support qualified counties (cities, districts) to carry out pilot projects related to comprehensive rural reform. Guide local governments to promote rural toilet improvement according to local conditions, promote the protection of rural drinking water safety and improve rural living environment.
(3) Regional coordinated development continued to deepen.
We will further improve differentiated fiscal and taxation policies, promote the implementation of major regional strategies and regional coordinated development strategies such as coordinated development of Beijing-Tianjin-Hebei, development of the Yangtze River Economic Belt, construction of Guangdong-Hong Kong-Macao Greater Bay Area, integrated development of the Yangtze River Delta, ecological protection and high-quality development of the Yellow River Basin, and comprehensive revitalization of the Northeast, and strive to build a regional economic layout with complementary advantages and high-quality development. We will continue to focus on the old revolutionary base areas, border areas and resource-exhausted cities, promote the settlement of people’s livelihood policy debts in key areas and special areas, promote the development of various social undertakings, and further enhance the balance and coordination of regional development. Establish an incentive and restraint mechanism for coal production, and increase the transfer payment for major coal transferred out of provinces.
(4) The new urbanization strategy was implemented in depth.
First, the demonstration work of sponge city construction continued to be implemented. We will continue to systematically promote the demonstration of sponge cities throughout the country during the 14 th Five-Year Plan period, and select and determine 15 demonstration cities through competitive evaluation. In 2023, a total of 15 billion yuan was allocated to ensure the smooth development of the demonstration work. At the same time, the performance evaluation of the demonstration subsidy funds for sponge city construction in 2022 was carried out, and 13 cities including Zhangzhou, Fujian and Changzhi, Shanxi were rated as A-level.
The second is to promote the effective protection and utilization of traditional villages. In the 14th Five-Year Plan, the second batch of 30 demonstration counties for centralized contiguous protection and utilization of traditional villages were selected, and 1.5 billion yuan of central financial subsidies were issued to encourage local governments to explore effective ways to protect traditional villages in China. The sixth batch of traditional villages in China was investigated and identified. The number of traditional villages in China reached 8,155, and 539,000 historical buildings and traditional houses were protected, and 4,389 provincial-level and above intangible cultural heritages were protected and passed down.
Third, the policy of supporting the urbanization of agricultural transfer population has been thoroughly implemented. By arranging 40 billion yuan of incentive funds for the urbanization of agricultural transfer population, the central government has increased its stable financial support for areas with large foreign population and improved the ability to guarantee basic public services for newly settled population.
Seven, strengthen the construction of ecological civilization, and promote green and low-carbon development to a new level.
Increasing investment, improving mechanism and deepening reform have provided solid financial support and strong policy support for promoting the construction of ecological civilization, and continuously promoted the green and low-carbon transformation of development mode.
(a) focus on supporting the fight against pollution.
First, the blue sky defense war has been further promoted. We will allocate 33 billion yuan for the prevention and control of air pollution, strengthen investment in key areas such as Beijing-Tianjin-Hebei and its surrounding areas, Fenwei Plain and Yangtze River Delta, support the development of key tasks such as clean heating in winter in the northern region, collaborative control of fine particles and ozone, atmospheric environmental control and management capacity building, and promote local governments to speed up the resolution of outstanding problems affecting air quality. In 2023, the proportion of excellent days in 339 cities at prefecture level and above was 85.5%, and the air quality remained basically stable under the increasing adverse climatic conditions.
Second, the battle for clear water continued to advance. 25.7 billion yuan was allocated for water pollution prevention and control, focusing on the Yangtze River and Yellow River basins, supporting local governments to carry out water pollution control and water ecological protection and restoration, and promoting the protection of centralized drinking water sources. Promote the construction of compensation mechanism for horizontal ecological protection and extend the pilot award and compensation policy in the Yellow River Basin until 2025. Throughout the year, we coordinated and promoted the establishment of six inter-provincial mechanisms, such as the main stream of the Yellow River (Ganning section), and renewed four basin mechanisms, such as Xin ‘anjiang. In 2023, the proportion of excellent surface water quality sections in China was 89.4%, up 1.5 percentage points year-on-year; The proportion of inferior class V was 0.7%, which was flat year-on-year.
Third, the pure land defense war continued to deepen. 4.4 billion yuan was allocated for the prevention and control of soil pollution, focusing on the treatment of tailings ponds left over from heavy metal history to support the prevention and control of the source and effectively prevent the risk of soil pollution transmission. In 2023, the national soil environmental risks will continue to be effectively controlled, the safe use of key construction land will be effectively guaranteed, and the soil environmental conditions of agricultural land will be generally stable.
(2) Systematic promotion of ecosystem protection and restoration.
First, the integrated protection and systematic management of mountains, rivers, forests, fields, lakes, grass and sand have been carried out in depth. Funds of 14.2 billion yuan were allocated to support local governments to carry out integrated protection and restoration projects of grass and sand in landscapes, forests, fields and lakes. Seven projects, including Huangshui River Basin in Qinghai, the upper reaches of Baiyangdian Lake in Hebei, the important source area of Yalu River in Jilin and the typical tropical areas in southern Hainan, were included in the scope of central financial support. From the perspective of the integrity of the ecosystem, comprehensive management, systematic management and source management of grass and sand in landscapes, forests, fields and lakes were promoted as a whole to promote the diversity, stability and sustainability of the ecosystem. Since the "Fourteenth Five-Year Plan", 27 projects have been supported, covering the core key ecological areas of the country’s "three regions and four belts" in an all-round way.
Second, the ecological restoration of abandoned mines left over from history has been strongly supported. We will allocate 3 billion yuan to solidly promote the demonstration project of ecological restoration of abandoned mines left over from history, select 18 projects, including the key ecological zone of the Yellow River in Linfen, Shanxi Province, to be included in the scope of central financial support, restore damaged mountains and surface vegetation, improve regional ecological conditions, and enhance the quality of ecosystems and carbon sink capacity.
The third is the promotion of the marine ecological protection and restoration system. We will allocate 4 billion yuan to select 16 projects, including Fujian Putian, to carry out marine ecological protection and restoration projects, and carry out marine ecological protection and restoration in all directions, in the whole sea area and in the whole process, so as to improve the quality of marine ecological environment and enhance the carbon sequestration capacity of marine ecosystems.
Fourth, the ecological protection and restoration of forestry grasslands have been solidly promoted. The central government allocated 102.8 billion yuan for the transfer payment of forestry and grassland, promoted the construction of a nature reserve system with national parks as the main body, scientifically carried out large-scale land greening actions, implemented the policy of rewarding and subsidizing the development of camellia oleifera industry, strengthened the protection of natural forest resources and grassland ecological restoration, consolidated the achievements of returning farmland to forests and grasslands, implemented the compensation of forest ecological benefits and the policy of ecological rangers, and strengthened the protection and restoration of wetlands and national key wildlife. We will implement the compensation for the protection of desertification land, strengthen the fire prevention of forest and grassland and the prevention and control of forest and grass pests, give incentives to areas where the implementation of the forest length system has achieved remarkable results, and provide strong support for the ecological protection and restoration of forest and grass.
(3) peak carbon dioxide emissions has made positive progress in carbon neutrality.
First, the role of tax incentives and constraints is effectively exerted. We will implement a green tax system of "multi-tax governance" such as environmental protection tax, resource tax, consumption tax, value-added tax and enterprise income tax. Give play to the macro-control role of tariffs, reduce import tariffs on some key components of wind turbines and other products, and implement the import tax policy for energy resources exploration, development and utilization during the 14 th Five-Year Plan period.
Second, the diversified investment mechanism has been continuously improved. Optimize the performance evaluation mechanism of commercial banks and commercial insurance companies, and guide financial enterprises to increase their support for the development of green industries. Promote the investment and operation of the National Green Development Fund and support the ecological protection and green development of the Yangtze River Economic Belt.
Third, the transformation of industrial structure in the energy sector continued to advance. Optimize clean energy support policies, vigorously develop renewable energy, encourage unconventional natural gas to increase production and quantity, promote clean and efficient use of coal, and promote the construction of a new energy system.
Fourth, international cooperation on climate change has been further strengthened. Actively lead multilateral development banks, and increase policies and investment and financing support for China’s green and low-carbon transformation and development. Actively participate in the global environment, negotiations on funding issues under the United Nations Framework Convention on Climate Change, deeply participate in the governance of international climate and environmental funding mechanisms and strengthen strategic guidance. Use loans and grants from international financial organizations and foreign governments to support energy transformation, energy efficiency improvement, biodiversity protection and other fields.
Fifth, it is more powerful to supervise and guide local financial departments. Promote local financial departments to implement the requirements of supporting the "double carbon" work, actively formulate and implement policies and measures that are in line with their own reality, and build a policy system of financial support for green and low-carbon development with rich policy tools, clear expenditure direction and comprehensive coverage. Combing and summarizing the typical experiences and practices of local financial support for "double carbon", and promoting them throughout the country, giving full play to the demonstration role of pilot areas.
Eight, build a solid "three guarantees" bottom line to ensure the smooth and orderly operation of local finance.
The "three guarantees" at the grassroots level are related to people’s well-being, grassroots governance and long-term stability of the country. The Ministry of Finance insists on taking the "three guarantees" at the grass-roots level as the top priority of financial work, constantly increasing the sinking of financial resources, compacting the main responsibility of local governments, strengthening dynamic monitoring and early warning, and building a solid bottom line for the "three guarantees".
(1) Minimize financial resources and support the improvement of county-level financial security capabilities.
The central government will increase the transfer payment to local governments, reaching 10.29 trillion yuan in 2023, and constantly improve the mechanism to guide the financial resources to the grassroots level in counties and districts. Improve the basic financial security mechanism at the county level, and encourage areas that strive to improve the financial balance at the county level. From 2010 to 2023, the funds awarded by the central government for the county-level basic financial security mechanism increased from 47.5 billion yuan to 410.7 billion yuan, with an average annual increase of 18%.
(2) Improve the implementation of the graded responsibility system and promote the "three guarantees" responsibility to the end.
In accordance with the principle of "county-oriented, municipal-level assistance (bottom-up), provincial-level bottom-up, and central incentives", we will comprehensively compact the main responsibility of county-level financial departments and ensure the "three guarantees" expenditure needs in terms of budget arrangement, budget implementation and treasury allocation; Require the municipal level to do a good job in auditing, monitoring and emergency disposal of the "three guarantees" budget of the counties and districts under its jurisdiction, and earnestly fulfill the responsibility of safeguard supervision and guidance; By increasing the transfer payment to the lower level, strengthening the allocation of treasury funds, improving the financial system below the city level and other measures, we will implement the responsibility of guaranteeing the municipal districts and counties not directly under the jurisdiction of the province; Supervise and urge the provincial level to improve the financial system below the provincial level, promote the balance of financial resources below the provincial level, fully implement the responsibility of ensuring the bottom, and do a good job in the management of "three guarantees" in the province.
(3) Improve monitoring and early warning to prevent the operational risks of grass-roots finance.
Establish and improve the monitoring mechanism of local financial operation, monitor and analyze the local financial operation every month, find problems as early as possible and carry out risk warning. Make full use of mechanisms such as monitoring and early warning of treasury security in key counties and districts across the country, implement classified management and focus on monitoring. Relying on the integrated budget management system, we will explore the realization of accurate daily monitoring of wage payment, dynamically prompt the local financial resources, treasury funds and other factors that affect the financial security ability, and effectively prevent and resolve the hidden dangers of "three guarantees".
Nine, strengthen local government debt management, firmly hold the bottom line of systemic risk.
Resolving the hidden debt risks of local governments, steadily resolving the hidden debts in stock, strictly curbing the new hidden debts, effectively strengthening the monitoring and supervision of local debts, and gradually reducing the debt risk level.
(1) Solidly promote the dissolution of existing debts, and gradually ease the hidden debt risks of local governments.
In accordance with the decision-making arrangements of the CPC Central Committee and the State Council, we will promote the implementation of a debt package and introduce relevant policies and measures to support the prevention and resolution of local government debt risks. Compacting the main responsibility of localized debt, adhering to the principle of provincial overall responsibility, urging provincial governments to strengthen risk analysis and judgment, strictly implementing the main responsibility, and gradually resolving risks by arranging fiscal revenue, reducing expenditures, and revitalizing existing assets and resources. Generally speaking, a series of measures to resolve debt risks are being implemented in an orderly manner, the positive effects are gradually released, the scale of hidden debts is gradually declining, and the risks are slowly released.
(2) Always maintain a high-pressure regulatory accountability situation and resolutely guard against new debt risks.
The first is to establish a normalized monitoring mechanism. Establish and improve the institutional system to prevent and resolve the hidden debt risks of local governments, strengthen information sharing and collaborative supervision among departments, guide local governments to gradually establish a full-caliber, normalized hidden debt monitoring system, and strengthen risk analysis and evaluation.
The second is to resolutely curb the increase in hidden debt. Strictly block the "back door" of illegal and illegal debt financing, focus on strengthening risk source control, harden budget constraints, require strict local construction project audit, strictly control the financial "gate" of new project financing, strengthen the debt financing control of local state-owned enterprises and institutions, strictly prohibit illegal borrowing for local governments in disguise, and never allow new hidden debts to be added to new projects and new stalls.
The third is to continue to maintain a high-pressure supervision situation. Seriously investigate and deal with all kinds of illegal borrowing behaviors, and find them together, investigate them together, and hold them accountable together. In 2023, the official website of the Ministry of Finance publicly exposed eight typical cases of implicit debt accountability of local governments, giving full play to the role of shock warning.
Ten, focus on financial management reform, promote the effective play of financial governance.
Focusing on promoting the modernization of the national governance system and governance capacity, strengthening financial supervision, strictly enforcing financial discipline, continuously deepening the reform of the fiscal and taxation system, consolidating the foundation of financial management, constantly improving the level and efficiency of financial governance, and striving to inject strong impetus into promoting high-quality development and accelerating Chinese modernization.
(1) Strengthen financial supervision and standardize financial discipline.
First, carry out the special action of accounting supervision in a down-to-earth manner. Focusing on promoting the implementation of the major decision-making arrangements of the CPC Central Committee and the State Council, focusing on three key areas, namely, the investigation and handling of major cases in the financial field, the special rectification of key issues in financial discipline, and the special supervision of the accounting evaluation industry, we organized special actions for accounting supervision, and carried out special inspections and verifications on 12 major cases to strengthen supervision and rectification and accountability.
The second is to do a good job in fiscal and taxation supervision. Resolutely investigate and deal with all kinds of violations of laws and regulations such as new hidden debts of local governments and false debts, and publicly expose 8 typical cases of accountability of hidden debts of local governments. Strengthen the supervision of budget management, carry out special inspections on the disclosure of local budgets and final accounts in 2022, and continue to strengthen the "one card" management of financial subsidy funds for benefiting the people and farmers, so that financial discipline can become an untouchable "high-voltage line".
The third is to strengthen the special supervision of the accounting evaluation industry. Organize the practice quality inspection of 41 accounting firms and 15 asset appraisal institutions, and select 89 enterprises to carry out the quality inspection of accounting information by adopting the method of "from the place to the enterprise". Organize provincial financial departments to carry out practice quality inspection on 2,161 accounting firms and 741 asset appraisal institutions. We will continue to carry out in-depth special rectification work on "four types" of typical violations of laws and regulations, such as registered accountants practicing in name only, practicing beyond their competence, accounting firms operating without a license, and selling audit reports online, as well as special rectification work on outstanding problems in the bookkeeping industry, such as "operating without a license" and "false promises" by bookkeeping agencies, so as to effectively clean up the industry atmosphere.
The fourth is to strengthen the construction of industry informatization. Optimize and improve the unified supervision platform for the CPA industry, promote the establishment of a single source system for audit report data, develop the verification function of audit reports, and strengthen the inspection of audit reports. Improve the operational guidelines for bank correspondence, and promote the standardization, intensification and digitalization of bank correspondence.
(2) Deepening reform and innovation, and making new progress in the construction of the modern fiscal and taxation system.
First, the reform of the budget system continued to deepen. Improve the operating budget system of state-owned capital, and report to the State Council for printing and distributing the Opinions on Further Improving the Operating Budget System of State-owned Capital, so as to give full play to the function of operating budget of state-owned capital. Strengthen budget performance management and issue the Interim Measures for Budget Evaluation Management.
Second, the tax reform has been steadily advanced. Study and optimize the tax system, further improve the personal income tax system combining comprehensive and classification, and raise three special additional deduction standards for personal income tax, such as infant care under 3 years old, children’s education and support for the elderly. We will implement the principle of statutory taxation, promote the second review of the draft value-added tax law to be submitted to the 14th the National People’s Congress Standing Committee (NPCSC) for deliberation, and actively promote the legislation of consumption tax, customs duties and other taxes.
Third, the reform of the financial system has been gradually improved. We will steadily push forward the implementation of the reform plan for the division of financial powers and expenditure responsibilities between the central and local governments in the fields of health care, transportation and natural resources, and promote the introduction of reform plans in the field of intellectual property rights. We will improve the central-local transfer payment system and revise the measures for the management of county-level basic financial security mechanisms. Guide local governments to promote the improvement of the financial system below the provincial level, and establish and improve the financial system below the provincial level with more reasonable allocation of powers and responsibilities, more standardized income division, relatively balanced distribution of financial resources and stronger grassroots protection.
Fourth, the reform of state-owned assets and state-owned enterprises has been deepening. Constructing the legal system of state-owned assets management in all directions. Implement the reporting system of state-owned assets and strengthen the analysis and monitoring of the operation of state-owned economy. Standardize and strengthen the management of administrative state-owned assets, and establish and improve the long-term working mechanism of asset revitalization. We will carry out the task of reforming state-owned assets and state-owned enterprises, and promote the reform of divesting state-owned enterprises from their social functions and solving problems left over from history. Strengthen the audit of state-owned capital income and the management of state-owned capital operating budget, and strengthen the statistical monitoring of the operation of government investment funds and the national transfer of social security state-owned capital. Deepen the reform of state-owned financial capital management, strengthen the long-term assessment of state-owned commercial insurance companies, and strengthen the financial management of state-owned financial enterprises.
(3) Persist in focusing on standardization and efficiency, and the modernization level of financial management has been continuously improved.
First, strict management of departmental budgets. Promote the construction of project expenditure standards, standardize the budget adjustment of central departments, strengthen budget constraints, strictly control the adjustment budget during implementation, and strictly manage the adjustment of project expenditures for personnel funds.
The second is to further promote budget performance management. Organize the central department to carry out pre-performance evaluation of new and expired major projects, and timely correct performance deviation and fund management loopholes. Focus on key areas such as education, science and technology, agriculture and rural areas, and carry out financial performance evaluation on 52 policies and projects. Continue to promote the key performance evaluation results and budget arrangements, improve management and improve policy substance.
The third is to continue to promote the integration of budget management. The integrated system of central and local budget management will be fully put into operation, covering more than 20,000 budget units at the central level, more than 3,700 local financial departments and more than 600,000 budget units. Improve and perfect the unified national integrated norms and standards system of budget management, and improve the standardized, scientific and standardized level of budget management of financial departments at all levels.
The fourth is to carry out the special action of budget execution supervision in a down-to-earth manner. Organize local supervision bureaus and provincial financial departments of the Ministry of Finance to carry out key supervision over 40 central department budget projects and 20 transfer payment projects, and timely discover and investigate a number of problems such as untimely budget issuance, illegal allocation and use of funds through the combination of daily supervision and special verification, so as to promote the improvement of the system and strengthen internal control, and form a closed loop of supervision and management.
The fifth is to further improve the government procurement system. Revise and improve the government procurement law, and study and formulate relevant work plans for deepening the reform of the government procurement system around promoting the construction of a modern industrial system and creating a market-oriented and legalized international business environment.
Eleven, deepen foreign financial exchanges and cooperation, and promote the continuous expansion of high-level opening up.
Deepen pragmatic cooperation in the financial field, serve the diplomacy of a big country with China characteristics, actively implement global development initiatives, unswervingly push forward the high-quality development of the "Belt and Road", focus on consolidating the basic disk of foreign trade and foreign investment, improve China’s voice and influence in the global economic governance system, and shape our favorable external environment.
(1) Actively participate in global economic governance.
Give full play to the role of the China-US economic dialogue mechanism, take the lead in setting up a China-US economic working group, actively carry out communication and dialogue, and serve the San Francisco meeting of the two heads of state and the informal meeting of APEC leaders. Deeply participate in multilateral mechanisms such as G20, BRICS and 10+3, and carry out multilateral cooperation on key issues such as debt, reform of multilateral development banks, infrastructure investment, customs and tax cooperation. Actively participate in WTO reform and steadily push forward negotiations and consultations on key issues such as e-commerce. Promote and strengthen strategic cooperation with the World Bank. Continue to deepen exchanges and cooperation with the Asian Development Bank in the areas of climate change, regional cooperation, knowledge cooperation, integrity and compliance. Support the steady operation of Asian infrastructure investment banks. In 2023, the total number of members of the AIIB increased to 109, and 56 projects were approved throughout the year, with loans exceeding 12 billion US dollars. We supported the New Development Bank to expand the loan scale, approved 106 loan projects with a total amount of about 35.77 billion US dollars, supported the issuance of panda bonds in China, and became the largest issuer of multilateral development institutions in the interbank market in China, steadily promoting the expansion of the New Development Bank. All-round participation in the governance and development of IFAD. In-depth participation in the consultation on the two-pillar plan for the reform of international tax rules. Solidly promote the promotion strategy of free trade zones, scientifically formulate tariff negotiation plans, promote the negotiation and signing of free trade agreements with Nicaragua and other countries, implement tariff concession commitments such as RCEP with high quality, and actively promote the work of joining CPTPP and DEPA.
(2) Support the high-quality joint construction of the "Belt and Road" and go deep and practical.
Study and formulate the "One Belt, One Road" Debt Sustainability Analysis Framework to support the improvement of China’s overseas sovereign debt risk monitoring and management. With loans of US$ 4.2 billion from international financial organizations and foreign governments, we will support the construction of 19 projects in the areas of ecological protection and restoration, infrastructure interconnection and vocational education in the Yangtze River Economic Belt. Successfully promoted the Asian Development Bank to provide RMB sovereign loan products and approved the first RMB sovereign loan project, achieving a "zero breakthrough". Encourage ADB’s Greater Mekong Subregion Economic Cooperation and Central Asia Regional Economic Cooperation Mechanism to strengthen the connection with global and regional strategies such as the global development initiative and the Belt and Road Initiative, and work together to promote regional economic recovery and sustainable development. Support the effective operation of multilateral development and financing cooperation centers, and promote the approval of nine projects, including the "East African Community Trade Portal Interconnection Capacity Building Project".
(3) focus on consolidating the basic disk of foreign trade and foreign investment.
First, carry out in-depth demonstration of improving quality and efficiency in foreign trade and economic cooperation. The central government arranged special funds for the development of foreign trade and economic cooperation, supported the second batch of 10 provinces to start the demonstration of improving quality and efficiency of foreign trade and economic cooperation, and continued to support the first batch of 8 provinces to implement the demonstration work, focusing on key export-oriented industries, focusing on increasing high-quality imports, improving export quality, improving the level of attracting foreign investment, optimizing foreign investment, and promoting the quality and efficiency of related industries.
The second is to play the role of guiding fund for innovation and development of service trade. Encourage new ways of financing to support new trade formats and new modes. By the end of 2023, the Fund had decided to invest in 46 sub-funds and 24 direct investment projects, with a decision-making investment of 9.057 billion yuan and more than 500 investment enterprises, covering 18 pilot areas for innovation and development of service trade.
The third is to improve the tariff and import link tax policies. From January 1, 2023, the provisional import tax rate of 1,020 commodities will be lower than the most-favored-nation tax rate, and the import of advanced technology and equipment, key parts, medical supplies and high-quality consumer goods will be encouraged, and the introduction of high-quality resource elements will be supported. From July 1, 2023, the eighth step of tariff reduction for expanded products was implemented in the WTO Information Technology Agreement, and the total tariff level in China was reduced to 7.3%. Docking high international standards, we will pilot relevant import tax policies and measures in conditional free trade pilot zones and free trade ports, promote the institutional opening of trade in goods, and promote the steady improvement of foreign trade and foreign investment. Introduce and continue to implement cross-border electronic commerce’s tax policy on returned export commodities, and support the development of new cross-border e-commerce foreign trade formats.
Fourth, actively do a good job in export tax rebate. Expand the scope of implementation of the pilot tax refund policy at the port of departure, and implement the tax refund policy at the port of departure in Tianjin, Liaoning, Zhejiang, Fujian, Shandong and other places since April 2023. Give full play to the role of "Yixin Europe" in promoting the development of foreign trade, increase Zhejiang East China International Intermodal Port (Jinhua South Station) and Yiwu land port (Yiwu West Station) as departure ports, and take Alashankou, Horgos Railway Port and Ningbo Zhoushan Port as departure ports, and implement the tax refund policy for land departure ports. Actively support Ningbo to implement the tax refund policy for overseas tourists.
Fifth, continue to issue sovereign bonds in Hong Kong. Sovereign bonds have been issued in Hong Kong for 15 consecutive years, and a total of 311 billion yuan of government bonds have been issued, boosting the scale of RMB deposits in Hong Kong from 60 billion yuan in 2009 to nearly one trillion yuan. Among them, in 2023, 50 billion yuan of government bonds were issued in Hong Kong in four phases, an increase of 117% over the previous year, and the scale reached a record high.
XII. Prospect of fiscal policy in 2024
In 2024, under the guidance of Socialism with Chinese characteristics Thought of the Supreme Leader in the New Era, the Ministry of Finance will fully implement the spirit of the 20th Party Congress and the Second Plenary Session of the 20th Central Committee, adhere to the general tone of striving for progress while maintaining stability in accordance with the deployment of the Central Economic Work Conference, implement the new development concept completely, accurately and comprehensively, accelerate the construction of a new development pattern, make efforts to promote high-quality development, moderately intensify the proactive fiscal policy, improve quality and efficiency, consolidate and enhance the economic recovery, and continuously promote the effective improvement in quality and quantity of the economy.
In terms of "moderate strength", we will strengthen the overall planning of financial resources, and use a variety of policy tools such as deficit, special debt, national debt, tax and fee concessions, financial subsidies, etc. to moderately expand the scale of fiscal expenditure and promote sustained economic recovery. We will continue to arrange local government special bonds of appropriate scale and support local governments to increase efforts to make up for shortcomings in key areas. The central government still maintains a certain scale of transfer payments to local governments, especially increasing balanced transfer payments and tilting towards difficult and underdeveloped areas. Provincial finance should optimize the allocation of financial resources below the provincial level. Implement the structural tax reduction and fee reduction policy accurately and efficiently, and focus on supporting scientific and technological innovation and manufacturing development.
In terms of "improving quality and increasing efficiency", we will strive to promote the rule of law, scientificity, standardization and standardization of financial management, and spend the same money with greater results. Party and government organs should get used to living a tight life and concentrate their financial resources on great things. Optimize the structure of fiscal expenditure, make good use of limited incremental funds, and at the same time make great efforts to revitalize and adjust the stock. Fully implement budget performance management, strengthen financial supervision, standardize financial revenue and expenditure behavior, and improve the efficiency of financial resource allocation and the efficiency of capital use. Strengthen the synergy between fiscal policy and other macro policies, and strive to improve the effect of promoting high-quality development.
(1) Support the acceleration of the construction of a modern industrial system. We will continue to increase investment in science and technology, further focus on basic research, applied basic research and national strategic scientific and technological tasks, and promote high-level science and technology to stand on its own feet. We will increase support for industrial scientific and technological innovation, strengthen the protection of key R&D plans and major projects in the manufacturing sector, and support enterprises to participate more in major national scientific and technological projects. We will implement preferential policies such as R&D expenses plus deduction, tax relief for the transformation of scientific and technological achievements, and accelerated depreciation of fixed assets to encourage enterprises to increase investment in innovation. Implement financial support policies for specialized and innovative SMEs. In-depth implementation of small and medium-sized enterprises digital transformation city pilot.
(2) Support the expansion of domestic demand. Promote the construction of a unified national market, and treat all kinds of business entities equally in terms of financial subsidies, tax incentives and government procurement. Increase social security, transfer payments and other adjustments to increase the income of urban and rural residents. Study fiscal and taxation policies to encourage and guide consumption, and promote new growth points of consumption. We will further promote the implementation of county-level commercial construction actions and support the improvement of consumption-related infrastructure. We will continue to make good use of the funds for issuing additional treasury bonds in 2023, and timely allocate funds in strict accordance with the progress of project implementation. Government investment focuses on supporting key core technology research, new infrastructure, energy conservation, emission reduction and carbon reduction, fostering new development momentum, strengthening people’s livelihood and other weak economic and social links, and accelerating major projects in the 14 th Five-Year Plan.
(3) Support the protection and improvement of people’s livelihood. We will implement the employment priority policy, make overall use of policies such as tax reduction and exemption, social security subsidies, and loan interest subsidies, and support enterprises to stabilize and expand their posts and start their own businesses through multiple channels. Continue to increase investment in education and promote the construction of a high-quality education system. Improve the medical and health security system and support the comprehensive reform of public hospitals oriented to public welfare. We will improve the social security system, thoroughly implement the national overall planning of basic old-age insurance for enterprise employees, and strengthen hierarchical and classified social assistance and security. Strictly manage the "three guarantees" expenditure budget, increase the sinking of financial resources, and strengthen the tracking and monitoring of local financial operations.
(4) Support the promotion of urban-rural integration and coordinated regional development. We will support the work concerning agriculture, rural areas and farmers, raise the investment standard of high-standard farmland construction, strengthen the support of agricultural science and technology and equipment, improve the ability of food security, and earnestly consolidate and expand the achievements of poverty alleviation. Further promote the link between transfer payment and the citizenization of agricultural transfer population, and arrange a certain scale of incentive funds. Support the implementation of urban renewal, and promote the "three major projects" such as the construction of affordable housing, the construction of "flat and emergency" public infrastructure, and the transformation of villages in cities. We will further improve fiscal and taxation policies supporting major regional strategies and increase support for old revolutionary base areas, ethnic minority areas and border areas. Do a good job in designing the fiscal and taxation system and steadily promote the construction of Hainan Free Trade Port.
(V) Effectively prevent and resolve local government debt risks. Insist on doing our best and doing what we can, and carry out in-depth evaluation of financial affordability to enhance financial sustainability. Strengthen the management of local government debt, strictly implement the debt package, intensify the dissolution of hidden debts in stock, resolutely prevent new hidden debts, and improve the long-term mechanism of debt conversion. Strict financial discipline, strict implementation of various financial regulations and management systems, and resolutely investigate and deal with all kinds of illegal acts.
(6) actively and steadily plan a new round of fiscal and taxation system reform. Focusing on Chinese modernization goals and tasks and high-quality development requirements, we should adhere to systematic thinking, problem-oriented, establish first and then break, study and promote the reform of fiscal and taxation system, improve the modern budget system, optimize the tax structure, and improve the fiscal transfer payment system.