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Xie confirms decision to slash taxes

China is expected to cut corporate and individual taxes by 500 billion yuan (US$73.21 billion) this year in a bid to revive the economy, the finance minister said yesterday.

"China will keep implementing the tax cuts it announced last year to cut corporate and individuals' tax," Xie Xuren said during the National People's Congress.

China announced several tax schemes to reignite economic growth last year, including cutting the stock trading stamp duty from 0.3 percent to 0.1 percent and levy the duty only on selling shares.

Tax rebates on exports were also granted to various industries, including the export-oriented textile sector.

China also reformed value added tax to lower the cost to companies of buying equipment.

All the tax schemes are in line with China's measures of positive fiscal policy, including more public spending, to shore up economic growth.

Premier Wen Jiabao on Thursday forecast the budget deficit would widen to 950 billion yuan this year from 111 billion yuan last year.

The deficit is projected to account for less than 3 percent of China's economy.

The central government is targeting growth of 8 percent this year, following last year's 9 percent.


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