It's widely believed that the Chinese Government will come up with measures to lower residents' tax burden at its annual economic work conference to be held at the end of November, in hopes of expanding consumer spending.

In the face of shrinking external demand, tax reductions will undoubtedly help a lot in boosting domestic consumption.

According to Forbes, China ranks second in the world on tax burden, which was retorted by taxation authorities. But we have to admit that China's top personal income tax rate, 45 percent, is among the world's highest. Even if the country's corporate income tax has dropped from 33 percent to 25 percent, it's still much higher than most countries'. China's overall taxation burden is imposing negative effects on domestic demand. The current economic slowdown in the country should be first blamed on over-dependence on export and second, the excessive taxation pressure.

The rural market is a major growth point for domestic consumption. Despite the many tax exemption and reduction policies in rural areas, farmers are still living under heavy tax pressure. For example, to raise a pig involves 15 tax items, which directly affect farmers' income and rural consumption.

At a time when domestic demand is crucial, it's time to do something to give more tax breaks.

Guangzhou Daily

School Buildings Come First

In early November, China announced a stimulus package worth $586 billion to ward off the impact of the world financial crisis on its economy. Of the many projects to absorb huge capital input, most are expected to be in the transportation sector, such as railways, airports and highways.

But just as important and in need of desperate funds are the dilapidated schoolhouses in vast rural areas. These poor buildings are not only disrupting daily school routine, but also threatening students' safety.

Investment in schoolhouse construction will also stimulate the demand for building materials. More importantly, students in the countryside will have a safe place to learn.

China's investment in capital infrastructure usually accounts for more than 50 percent of its gross domestic product, while that in education is less than 4 percent. Is it possible to cut a sliver of the $586-billion cake for the education sector so as to relive its current plight?

Recent years have seen so many redundant construction projects. The government must be careful to avoid a huge waste of money when launching the new investment program.

To spend more on dilapidated school buildings, especially in central and western regions and equip schools with bigger playgrounds are a much more farsighted investment than some transportation projects.

Zhujiang Evening News

Corruption Down the Road

On November 11, the Ministry of Transportation announced that the country's investment in transportation infrastructure projects, such as highways and airports, would average 1 trillion yuan ($146.5 billion) in the next two years.