China quickens fiscal spending

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China's fiscal spending jumped in July to 37.1 percent from a year earlier, quickening from 17.7 percent in June, official data showed on Friday, the latest evidence that the government is stepping up efforts to combat an economic slowdown.

The world's second-largest economy expanded at the slowest pace in more than three years in the second quarter and the latest data pointed to weaker factory output and retail sales, fanning market expectations of fresh policy easing from Beijing.

Fiscal expenditure of 952.8 billion yuan ($149.83 billion) in July consisted of 167 billion yuan by central government and 785.8 billion yuan by local governments, the Ministry of Finance said in a statement on its website,

The government has been fast-tracking some infrastructure projects and doling out subsidies for energy-efficient home appliances in hopes of giving a lift to its economy.

Government spending was focused on key programmes to improve people's livelihood, the ministry said. Spending on affordable housing soared 39.2 percent during the January-July period from a year earlier while that on transportation rose 34.9 percent.

The government has also increased expenses on healthcare and education, with spending on the two areas rising 25 percent and 32 percent in the first seven months year-on-year, respectively.

China's fiscal revenues rose 8.2 percent in July from a year earlier to 1.07 trillion yuan, the ministry's data showed. The growth rate slowed from a rise of 9.8 percent in June and 13.1 percent in May.

The ministry attributed a slowing fiscal revenue growth to falling corporate earnings and tax cuts in some sectors.

Revenues from value-added tax in July edged up 0.7 percent from a year earlier, while consumption tax receipts rose 11.5 percent.

Receipts from cooperate income tax in July inched up 2.8 percent from a year earlier, after a rise of 10.1 percent in June, in line with the slowing economy and falling factory-gate prices, which eat into corporate earnings.

Fiscal incomes from business tax rose 13.3 percent from a year earlier, with tax receipts from the property sector rising 7.6 percent. - Reuters

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