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Farm tax scrapped in 22 Chinese provinces
(Xinhua/Shenzhen Daily)
Updated: 2005-01-18 11:22
China's agriculture enters a new era of zero tax with 22 of its 31 provinces,
municipalities and autonomous regions on the mainland scrapping all agricultural
taxes, releasing millions of farmers from their centuries-old tax burden in the
world’s most populous nation.
Premier Wen Jiabao announced in March 2004 that China planned to scrap all
farming taxes in five years. With more provinces working to relieve burdens on
farmers, whose income growth lagged behind their urban counterparts in the past
two decades of reform and opening up, the target is expected to be fulfilled two
or three years ahead of schedule.
Apart from the Tibet Autonomous Region where no farming or stockbreeding
taxes have ever been imposed, China tried the tax-free policies in two major
northeastern agricultural provinces, Heilongjiang and Jilin, in 2004, and the
other 19 provinces and municipalities announced the exemption this year.
Also in 2004, the Central Government cut agricultural taxes by 3 percent in
11 provincial-level regions and by 1 percent in other areas, the Finance
Ministry said.
The taxes and fees on farmers were slashed by about 28 billion yuan (US$3.38
billion) last year, a 30-percent reduction. Before the tax relief reform, the
State collected about 60 billion yuan a year in agriculture taxes.
Nearly 600 million farmers have also benefited from direct subsidies from
local governments which totaled 11.6 billion yuan while the Central Government
last year allocated 34.2 percent of the treasury bond proceeds, 37.6 billion
yuan (US$4.5 billion ), for agricultural products, mainly in grain production
regions.
Official statistics show that the per capita income for farmers last year
grew by 6 percent, the biggest rise since 1997.
The zero-tax policies were implemented in major agricultural provinces such
as Henan, Shanxi, Heilongjiang and Jilin, and relatively developed provinces and
municipalities such as Beijing, Shanghai, Guangdong, Jiangsu and Zhejiang.
About 400 million farmers nationwide are expected to benefit from the
exemption.
Some farmers working in cities planned to return home to resume farming after
the tax exemption was announced.
Economists say the exemption will stimulate domestic consumption and promote
the harmonious development of all the sectors of society.
Tax officials said the move also helped reduce crime rates.
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