The Second Session of the 13th National People's Congress opens at the Great Hall of the People in Beijing on March 5 (XINHUA)
The Report on the Work of the Government delivered by Premier Li Keqiang at the opening meeting of the Second Session of the 13th National People's Congress (NPC), the national legislature, on March 5 has made a package plan for the development of the economy and the improvement of people's livelihood.
The government work report, delivered by the premier at the opening meeting of the NPC annual session in March each year, concludes the government's work in the previous year and makes a plan for the year ahead. In this year's report, Li affirmed the progress that China made in 2018 amid the profound change in the external environment and challenges caused by the growing pains of economic transformation.
Also, expressing the government's clear awareness of the uncertainties and challenges facing China, Li unveiled a series of measures for sustainable development in 2019, which were described by the media as the largest "gift bag" ever provided by the government and were welcomed by the public.
For Lei Jun, a deputy to the 13th NPC and the founder and CEO of Xiaomi Corp., a domestic tech giant in China, what impressed him most in the report is the part about tax reduction. According to the report, China aims to reduce the tax burdens and social insurance contributions of enterprises by nearly 2 trillion yuan ($298.3 billion) in 2019.
"Before Premier Li delivered the report, some reporters asked me what if the government reduces the value-added tax by 3 percent this time. I said 'impossible' immediately," Lei said at an NPC panel discussion on March 5 after the government work report was delivered.
"When I heard Premier Li announce that the government will reduce value-added tax by 3 percent from 16 percent to 13 percent, I was thrilled. Many other entrepreneurs at the Great Hall of the People couldn't help applauding. We felt the government's determination to create a more business-friendly environment, especially for the manufacturing companies."
What does this 3 percent mean to enterprises? Zhang Xinghai, a deputy to the 13th NPC and the President of Chongqing Sokon Industry Group, said the 3-percent reduction alone will save the company 60 million yuan ($8.82 million) annually. "In this way, we can spend more money on R&D and focus more on high-quality development. This will bring long-term benefits to manufacturing companies."
Chen Hua, a deputy to the 13th NPC and General Manager of Panjiang Coal and Electricity Refco Group Ltd. from Guizhou Province, said this new measure will save about 500 million yuan ($73.5 million) for his group.
"The report says the total government expenditure will see an increase of 23 trillion yuan ($3.38 trillion) this year, up by 6.5 percent from last year," Chen said. "Despite this, the government will continue to cut tax