China's State Council Information Office (SCIO) highlighted significant strides in tax system modernization during a press conference on Monday, detailing achievements under the 14th Five-Year Plan (2021-2025). Officials emphasized reforms designed to bolster economic resilience, streamline compliance, and foster innovation amid global uncertainties.
Key Reforms and Economic Impact
Tax cuts totaling 8.6 trillion yuan ($1.2 trillion) were implemented during the period, with a focus on supporting small and medium-sized enterprises (SMEs) and green energy sectors. A simplified value-added tax (VAT) structure and expanded digital tax services reduced administrative burdens for businesses, contributing to a 15% year-on-year increase in new market entities in 2023.
Digital Transformation Accelerates
The 'Smart Tax' initiative, leveraging AI and blockchain technologies, now processes 92% of routine tax filings automatically. This shift has cut average processing times by 40%, according to SCIO representatives, while reducing compliance costs for foreign investors by 25%.
Cross-Border Collaboration Strengthened
New double taxation avoidance agreements with 18 countries and regions, including APEC members, aim to enhance international trade flows. The reforms align with China's broader strategy to deepen economic integration while maintaining stable growth of 5.2% in 2023.
Analysts suggest these measures position China to meet its 2025 targets for high-quality development, with particular benefits for technology-driven industries and sustainable infrastructure projects across Asia.
