China fiscal revenue up 6.3% in first two months

A clerk counts yuan bills at a bank in Huaibei, East China's Anhui province. [Photo/IC]

BEIJING - China's fiscal revenue rose 6.3 percent year on year to 2.74 trillion yuan ($421.3 billion) in the first two months of 2016, data from the Ministry of Finance showed on Wednesday.

The data came after China's fiscal revenue logged its slowest pace since 1988 last year as the broader economy slowed.

In breakdown, the central government collected 1.18 trillion yuan in fiscal revenue, up 1.6 percent year on year, while local governments saw fiscal revenue expand 10 percent to 1.56 trillion yuan.

Thanks to robust property transactions in major cities, real estate business taxes went up 20.2 percent year on year to 116 billion yuan. Resource taxes plunged 24.8 percent due to sluggish crude oil and coal prices.

During the January-February period, fiscal spending expanded 12 percent to 2.12 trillion yuan, with spending on the affordable housing program surging 30.7 percent.

To cushion the blow from sagging revenue growth and balance the need for a proactive fiscal policy to support growth, China plans to increase its deficit-to-GDP ratio to 3 percent this year from 2.3 percent last year.

The rise of 0.7 percent in the ratio, based upon China's GDP, would provide the government about 470 billion yuan more to spend, projected mainly to cover tax and fee reductions for enterprises.