The Central Economic Work Conference has proposed that the proactive fiscal policy should be more effective in 2023, Global Financial News, the voice of the China Media Group, reported. On the morning of January 1, at a series of themed press conferences held by The State Council Information Office, Liu Kun, Minister of Finance, explained in detail where the "booster point" of this year's proactive fiscal policy will be. How to further improve effectiveness?

The proactive fiscal policy has increased its effectiveness, reflecting the general principle of seeking progress while maintaining stability, and taking into account needs and possibilities, the current and the long-term, and development and security. Liu Kun, Minister of Finance, said the foundation for China's economic recovery is not yet solid, with the triple pressures of contraction in demand, supply shock and weakening expectations still large and the external environment volatile. To address these risks and challenges, we need to strengthen fiscal macro-control, optimize the mix of policy tools, and ensure that fiscal sustainability and local government debt risks are under control while effectively supporting high-quality development.

"Extra force" means moderately increasing the expansion of fiscal policy. Liu Kun said that there are three main points: one is to increase the intensity of fiscal expenditure. On top of the 26.06 trillion yuan projected for the general public budget in 2022, this year we will appropriately increase government spending by coordinating government revenue, deficit, interest discount and other policy tools. Second, we will increase efforts to boost investment in special bonds. We will make appropriate arrangements for the amount of local government special bonds and appropriately expand the areas in which they are invested and used as capital to create a driving force for investment. The third is to promote the sinking of financial resources. We will continue to increase transfer payments from the central government to local governments, give preference to areas in difficulty and less developed areas, and ensure that the three guarantees are met at the community level.

To improve policy effectiveness means to improve policy effectiveness. Liu Kun pointed out two aspects to improve efficiency: on the one hand, improve tax preferential policies, more precise and targeted, and focus on helping enterprises rescue. On the other hand, we will improve the structure of government spending, make better use of government funds to boost investment and consumption. At the same time, we will strengthen coordination and cooperation with monetary, industrial, scientific and technological, and social policies to form policy synergy and promote overall economic improvement.

To be specific, there are five key points for strengthening the effectiveness of proactive fiscal policy. First, we will improve policies to support taxes and fees to ease the difficulties of enterprises. Second, we will strengthen overall coordination of government resources and maintain the intensity of necessary expenditures. Third, we will work hard to optimize the structure of expenditure and improve its efficiency. Fourth, equalize financial resources among regions and promote equal access to basic public services. Fifth, we will tighten financial discipline and guard against financial risks. Liu said he will actively support key areas such as science and technology, rural revitalization, education and green development. We will improve the mechanism for direct access to government funds and promote their standardized and efficient use.

Source: Ministry of Finance of the People's Republic of China