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China / Society

Tightened income control in monopolized sectors

(Xinhua) Updated: 2012-12-20 22:27

BEIJING ?-- China will increase its control over high earnings in monopolized sectors next year amid efforts to address income disparities, Minister of Finance Xie Xuren said Thursday.

The government will improve its control policies on both the gross pay and the industry wage level in monopolized sectors in 2012 to optimize the national income distribution structure, Xie said at a national finance work meeting.

Unfair income distribution has been a major source of public complaint over recent years, with many targeting state-run sectors. Economists view the issue as a major obstacle in deepening the country's economic reform.

A State Council meeting in October said the government would formulate a general income distribution reform scheme in the fourth quarter of the year.

Xie said the government will also work to promote the performance pay policy in government-affiliated institutions and regulate allowances and subsidies for civil servants next year.

The meeting also pledged to maintain a proactive fiscal policy that will improve tax reform, optimize government spending and enhance quality and efficient economic growth.

In terms of social security expenditure, more policy measures will be rolled out in 2013, such as an adjustment mechanism for the basic pension insurance of enterprises' retirees and an increase in financial subsidies for medical insurance in rural and urban areas, he said.

Xie promised more efforts in stepping up the promotion of value-added tax (VAT), as the government will embark on nationwide pilot programs on transportation and part of the tertiary industry next year.

The VAT, which is set to replace the country's current business tax, will be expanded to more regions and will cover a wider range of industries, including telecommunications, rail transport and construction and installation industries, according to Xie.

In the next year, the country will maintain a steady export policy and lower the import tariff for energy products, resources and raw materials.

Imports of advanced technical equipment and key industrial components and parts are also expected to see lower temporary tax rates, according to the meeting.

More financial measures are also expected in the next year to support strategic emerging sectors, shore up energy conservation and boost the circular economy as part of the efforts to promote quality and efficient economic growth, Xie said.

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