The country completed the reform of its taxation system. The plan extends from tangible goods to firms involved in construction, property, finance and consumer services.
Officials said that it will lighten tax burdens comparing to business tax, which should boost investment and economic growth,but will contribute to fiscal deficit.
Implementing complex new rules will also be a scramble, which mainly lies in the share between local authorities and the centre. Because business tax accounted for 40% of local government revenues. So off-stage bickering will ensue between Beijing and the provinces over new tax-sharing arrangements intended to cushion the blow.
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