China’sFiscalRevenuePostsFastestGrowthSinceLastYear

China's Fiscal Revenue Growth Fastest in Over a Year

China’s fiscal revenue posted its fastest monthly growth in more than a year in March, giving Beijing more room to sustain spending despite a prolonged property slump.

China’s general public budget (GPB) revenue rose 6.9% year-on-year, supported by higher prices, solid imports and improved tax compliance, finance ministry data showed. The GPB is the largest of the four budgets in the country’s fiscal system.

First-quarter revenue grew 2.4%, outperforming the same period in the past three years.

The Four Budgets in China's Fiscal System

A key driver was the producer price index returning to growth in March after more than three years of decline, lifting price-linked tax receipts. Import-related taxes also outpaced overall growth, reflecting strong trade.

Personal income tax surged 190%, mainly due to Lunar New Year timing shifts and annual settlement effects, alongside tighter enforcement. Tax revenue from stock trading and vehicle purchases also rose.

Corporate income tax fell 13.8%, as companies paid less in annual tax settlements than a year earlier, while property-related taxes continued to contract, underscoring real estate weakness.

The improvement in GPB revenue supported government spending, which rose 1.1% in March. In the first quarter, authorities executed 24.9% of the annual spending budget, the fastest first-quarter pace in five years.

However, weak land sales remained a drag, with related revenue in the government-managed funds budget down more than 20% in March.

Contact editor Lin Jinbing (jinbinglin@caixin.com)