BEIJING -- Following are some quotes on deepening China's fiscal and taxation reform and adjusting income distribution from Liu Kegu, a political advisor and former vice president of China Development Bank, at the annual session of the Chinese People's Political Consultative Conference (CPPCC) National Committee on Friday:
-- More should be done to deepen reform in fiscal system, adjust income distribution, bridge residential income gap and boost basic public services provided by grassroots-level government to promote the transformation of economic growth pattern and social harmony.
-- Indirect tax ratio to the total tax revenue should be reduced, as it would increase actual tax incidence on middle and low income groups. Indirect tax ratio now accounts for more than 60 percent of China's tax revenue, but in European countries with similar taxation structures, the ratio stands below 35 percent.
-- Taxation reform should target a larger coverage of personal income tax, lower tax rates for the middle-income class, lower stamp duty on stock trading, and the introduction of property tax.
-- More taxes should be levied on excessive profit from resources, and more profits from monopolistic state-owned enterprise should be submitted to the government. Part of the income from state assets operation could be used to support social security when necessary.
-- Enterprises are gaining a larger share of income distribution, especially those monopolistic ones, as a result of abnormal factors like excessive profits from industrial monopoly and resources, and limited profit return to the government.
-- China's local tax system has not been completely established, with imperfect transfer payment system and inconsistency between the financial capabilities and obligations of local government.
