BEIJING: China’s general public budget revenue is expected to grow at around 2 percent year-on-year in 2025, which analysts said is a prudent goal in the face of both domestic challenges and external uncertainties, after local governments recently unveiled their financial plans. General public budget revenue is the sum of tax revenue and non-tax revenue. Despite facing a tight fiscal balancing act, China will resort to a more proactive fiscal policy this year, including raising the fiscal deficit-to-GDP ratio and issuing more government bonds, to steer the economy toward a sustainable, high-quality growth trajectory, they said. While the Xinjiang Uygur autonomous region and the Xizang autonomous region stand out with expected year-on-year general public budget revenue growth of about 10 percent, the remaining 29 provincial-level regions on the mainland have set more conservative targets, with growth rates largely concentrated between the 2 percent to 3 percent range. Guangdong province, the nation’s top general public budget revenue generator in 2024, and Shandong province, ranking fifth, both project 3 percent growth in their general public budget revenues. Meanwhile, Jiangsu province, Zhejiang province and Shanghai — ranking second, third and fourth, respectively — have set even more conservative targets of 2 percent. An analysis of budget plans reveals that China’s 31 provincial regions on the mainland have set an average growth target of 2.8 percent for general public budget revenue in 2025, marking a decline of 1.6 percentage points compared to last year’s target average, said Luo Zhiheng, chief economist at Yuekai Securities.
Over the past decade, China’s national fiscal revenue growth targets have consistently been slightly lower than those set by local governments, with the difference typically within 1 percentage point, Luo said.
This trend is very likely to continue in 2025, as the central government might aim for a modest general public budget revenue growth target of around 2 percent, Luo added.
China’s fiscal revenue expectations for 2025 are closely tied to the broader economic outlook, as local governments have already set a weighted average GDP growth target of about 5.3 percent for this year. –The Daily Mail-China Daily news exchange item
