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Central government spending this year is expected

China's Minister of Finance Lou Jiwei takes questions from journalists at a news conference during the ongoing two sessions in Beijing Andre Drummond Womens Jersey , March 6, 2015. [Wang Jing chinadaily]
China's Finance Minister on Friday denied rumor that the government spent 300 billion yuan ($47.9 billion) on public vehicles, receptions and trips.

"It is nonsense to say that," said minister Lou Jiwei at a press conference.

Public funds for government vehicles, officials' overseas trips and official receptions are known as "three public funds."

The central government's expenditure of the funds was 7.1 billion yuan last year, 800 million yuan lower that that of 2013 Blake Griffin Womens Jersey , he said. "The funds for this year would not exceed last year's level."

Lou said he was not clear about the use of funds in local governments, but he estimated the total figure would be dozens of billion yuan, rather than "300 billion yuan" as rumored.

Here are other highlights of the press conference.

Proactive fiscal policy

China's Minister of Finance Lou Jiwei (second of left) takes questions from journalists at a news conference during the ongoing two sessions in Beijing, March 6, 2015. [Wang Jing chinadaily]

"We must adopt a moderately expansionary fiscal policy in coping with downward pressures, as we de-leverage the economy step by step while preventing it from nose-diving Reggie Jackson Authentic Jersey ," Lou said.

Signs of recovery in world economy are not obvious enough, including that in the United States, said Lou, adding that China will be affected by such "new normal" of the world economy.

Personal income tax

The government will loosen taxes charged on enterprise annuity to support the fragile pension system encumbered by an aging population.

It's not fair to raise the threshold for personal income tax, Minister of Finance Lou Jiwei said.

Lou also acknowledged drawbacks in the taxation system in regard to personal income, while responding to a question whether more tax cuts are expected to drive consumption needs.


While strengthening the management and reform of mandatory social pension Andre Drummond Authentic Jersey , the ministry has also implemented tax preference policies that support enterprise annuity.

Pilot programs have been carried out on adopting EET model in pension system. "The ministry will work with China Insurance Regulatory Commission to raise a nationwide plan," Lou said.

Asian Infrastructure Investment Bank

The offer of being a founding member of the Asian Infrastructure Investment Bank (AIIB) is still open but the ball is in Japan's court, Lou said.

The chance to be an AIIB founding member is available for all Asian countries including Japan by March 31, Lou said.

"They told us they are considering. Whether Japan will join, we do not know. It is Japan's own decision," he added.

Local government debt

The risk of China's local government debt is generally controllable Blake Griffin Authentic Jersey , Lou said.

"China's local government debt problem is a fact," Lou said, "the government is guarding against regional financial risks."

"On the whole," he said, "the risk of China's local government debt is controllable."

Tax reform

Government's plan to transform business tax to value-added tax will expand to immovable property in 2015, although calculating the tax rate is difficult Reggie Jackson Jersey , Lou said. The taxpayer will benefit from the step.

China's Minister of Finance Lou Jiwei (center) takes questions from journalists at a news conference during the ongoing two sessions in Beijing, March 6, 2015. [Li Xiang chinadaily]

Hong Kong and yuan-dominated treasuary bonds

China will continue to issue yuan-denominated treasury bonds in Hong Kong Special Administrative Region, Lou said.

Hong Kong has been given the unique position in floating yuan-denominated treasury bonds, because the majority of offshore renminbi is traded in Hong Kong and it is China's territory, he stressed.

Tax Preference policies under "new normal"

It is part of reform to increase tax preference policies Andre Drummond Jersey , especially regional tax preference policies, said Lou. "There will be no new policies added, we will focus on putting the old policies in order and maintain a fair competition based on the market."

According to Lou, not only China's economy is entering the new normal, the global economy is entering the new normal as well. "It is a de-leveraging process ever since the global economic crisis in 2008, different countries are undertaking the effect differently Blake Griffin Jersey ," said Lou. Under an unclear momentum of global economic recovery, China needs to face the downward pressure and adopt a moderate expansion policy, added Lou.

Data and background

Central government spending this year is expected to total 2.5 trillion yuan, up 10.4 percent, to which a further 27.9 billion yuan ($4.46 billion) is to be added in funds carried over from previous years, according to a report released by Ministry of Finance on Friday.

Major progress has been made in reforming the fiscal and tax systems Wholesale Detroit Pistons Jerseys , said the report. In 2014, the ministry worked to ensure that constraints on budgets were tightened, fiscal and budgetary management was made more standardized, further improvements were made to the system for managing government debt and financial discipline was strengthened.

According to the report, the ministry will continue to implement proactive fiscal policy in 2015, as appropriate Cheap Detroit Pistons Jerseys , increase the intensity. The ministry will increase the deficit by an appropriate amount and put to use funds carried over from previous years to increase the intensity of spending.

Government deficit for 2015 is projected to be 1.62 trillion yuan nationwide, an increase of 270 billion yuan over last year, with increases in both the central and the local government deficit, the report said.

The ministry will implement structural tax cuts and reducti

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