China's Tax Revenues Rise 22.6% in 2011

China's tax revenues surged 22.6 percent year-on-year to 8.97 trillion yuan ($1.42 trillion) in 2011, the Ministry of Finance said on Feb. 14, 2012.
The growth rate stayed flat with that of last year, the ministry said in a statement on its website.

The steady growth was a synthesized reflection of the country's relatively fast economic growth, high consumer prices, and good corporate performances over the past year, the ministry said.

Production-related taxes rose the most last year. Receipts from value-added tax and turnover tax grew 15 percent to 2.43 trillion yuan and 22.6 percent to 1.37 trillion yuan, respectively, in 2011, remaining unchanged from one year earlier.

Meanwhile, revenues from corporate income tax surged 30.5 percent year-on-year to 1.68 trillion yuan, up from 11.3 percent last year, accounting for 18.7 percent of the country's total tax revenues.

The resource tax made a noticeable 43.4-percent rise to hit 59.89 billion yuan last year, up 19.9 percentage points from one year earlier, as the country mulls tax reforms to boost the sector's sustainable development.

But tax revenue growth slowed on a quarterly basis last year. Tax revenues grew 6.8 percent in the fourth quarter of 2011, down from 22.6 percent in the third quarter, 27.2 percent in the second quarter, and 32.4 percent in the first quarter, the ministry said.

The ministry said the quarterly decrease was caused by a slowing economy, tax-reduction policies, cooling auto and property sectors as well as losses in the oil refining industry, the ministry said.

The economy expanded by 9.2 percent year-on-year in 2011, with its GDP growth rate dropping to a 10-quarter low of 8.9 percent in the fourth quarter, according to the National Bureau of Statistics (NBS).

To ease the effects of rising consumer prices on people's daily lives, the government raised the personal income tax threshold from 2,000 yuan to 3,500 yuan in September.

As a result, personal income tax revenue dropped 5.5 percent year-on-year in the last quarter of 2011. But the whole year's personal income tax revenue registered 25.2-percent growth from the previous year.

The ministry attributed the still-dazzling growth in personal income tax revenue to rising residential incomes, the ministry's efforts to enhance tax collection, and the blossoming capital and art markets, which fueled the property transfer tax income.