China’s Public Revenue Is Likely to Miss 2022 Target Despite November Jump, Analysts Say
Chen Yikan
DATE:  Dec 21 2022
/ SOURCE:  Yicai
China’s Public Revenue Is Likely to Miss 2022 Target Despite November Jump, Analysts Say China’s Public Revenue Is Likely to Miss 2022 Target Despite November Jump, Analysts Say

(Yicai Global) Dec. 21 -- China’s general public revenue will probably not reach this year’s annual growth target of 3.8 percent, despite surging by the most in 2022 last month, according to analysts.

General public budget revenue shot up 24.6 percent to CNY1.21 trillion (USD173.6 billion) in November from a year ago, finance ministry data showed yesterday. Fiscal revenue soared 28.4 percent to CNY1.02 trillion.

General public revenue surged last month because of the low base a year earlier, when tax revenues tumbled following a major correction in commodity prices and a downturn in the property market, Luo Zhiheng, chief economist at Yuekai Securities, told Yicai Global.

In the first 11 months of this year, general public revenue fell 3 percent to CNY18.55 trillion (USD2.66 trillion) from the same period last year, with the decline narrowing 1.5 percentage point from the first 10 months, buoyed by the strong fiscal revenue growth in November, according to data released by the ministry.

Tax cuts and rebates worth more than CNY2 trillion and downward pressure on the economy are the main reasons why general public revenue fell this year. Factoring out the tax changes, it would have climbed 6.1 percent in the January to November period.

Government fund income, or the money mainly collected from land use right auctions, is another key source of revenue. Transfers of state-owned land use rights slumped 24.4 percent to CNY5.12 trillion in the first 11 months from a year earlier.

The property market needs more time to recover, Luo noted, adding that it may steady after government policies to stabilize growth and measures targeting the industry alleviate developers’ risks.

General public expenditure rose 6.2 percent to CNY22.73 trillion in the January to November period from a year earlier, versus an annual gain of 6.4 percent in the first 10 months, according to finance ministry figures.

The decline in general public expenditure is out of line with the growth in infrastructure, which has been on the rise for seven consecutive months, probably because of the lack of funds to form actual fiscal expenditure, Luo said.

Editors: Xu Wei, Futura Costaglione

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Keywords:   Government Revenue,Government Spending,Ministry of Finance