China 2005 tax revenue surges far beyond forecast

Beijing, Jan 1 | Updated: Jan 2 2006, 06:05am hrs
Tax collections from Chinas booming economy surged far beyond the budget forecast last year, rising 20% to a record 3,087 billion yuan ($382 billion), government figures showed on Sunday.

The government had budgeted for a rise of just 11% to 2.93 trillion yuan, leaving a 2005 deficit of 300 billion yuan.

Although the State Administration of Taxation did not say what the final fiscal balance had been, the above budget rise in tax was enough to wipe out most of the forecast deficit if spending was on target. The administration announced the figure on its website, www.chinatax.gov.cn.

Chinas economy has been growing faster than 9% annually for more than two years. While inflation can lift people into higher tax brackets, Chinese prices have risen little lately.

November consumer prices were up just 1.3 percent on a year earlier. The tax administration said its revenue figure excluded customs duties and agricultural tax.

The parliament last week approved the scrapping of the decades-old agricultural tax, which farmers must pay regardless of their income. It raised only 1.5 billion yuan last year.

Reuters