Overview

In 2025, in the face of profound and complex changes in both the domestic and international environment, all regions and departments, under the strong leadership of the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at its core, thoroughly implemented the guiding principles of the 20th CPC National Congress and the plenary sessions of the 20th CPC Central Committee. Acting in accordance with the decisions and arrangements of the CPC Central Committee and the State Council, we firmly applied the new development philosophy, promoted high-quality development, coordinated both domestic and international imperatives, and balanced development and security. More proactive and effective macro policies were implemented. Despite mounting pressures, China’s economy continued to advance and improve, the main goals for economic and social development were successfully achieved, the 14th Five-Year Plan (2021-25) reached a successful conclusion, and solid new strides were made in advancing Chinese modernization.

Fiscal authorities at all levels adhered to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and implemented the decisions and arrangements of the CPC Central Committee and the State Council in a thorough manner. A more proactive fiscal policy was effectively implemented with sustained and intensified efforts. Coordination with other policies was strengthened to provide solid support for achieving the annual targets and tasks for economic and social development.

First, we implemented a more proactive fiscal policy. We strengthened the coordination of fiscal resources and maintained the intensity of fiscal expenditure, with general public budget expenditure reaching 28.74 trillion yuan for the year. A total of 1.3 trillion yuan in ultra-long-term special treasury bonds was issued to support the implementation of major national strategies and the security capacity in key areas, as well as the program for large-scale equipment upgrades and consumer goods trade-ins. Newly issued local government special-purpose bonds totaled 4.4 trillion yuan, supporting more than 48,000 projects. Special treasury bonds totaling 500 billion yuan were issued to replenish the core tier-one capital of large State-owned commercial banks. Interest subsidy policies were introduced and implemented for personal consumer loans and loans to business entities in the service sector. Pilot programs were launched to foster new consumption business models, formats and scenarios and to develop an international consumption environment, stimulating consumption from both the supply and demand sides. Policies on duty-free shops and departure tax refunds were adjusted and optimized to encourage and expand inbound consumption. A tax credit policy for overseas investors who reinvest distributed profits directly in China was introduced and implemented to further stabilize foreign trade and foreign investment.

Second, we made solid progress in promoting high-quality development. We implemented the strategy for building China into a scientific and technological powerhouse and fully ensured funding for major national science and technology projects and breakthroughs in key core technologies. The allocation, management and use of central government science and technology funds were improved to enhance the efficiency of sci-tech investment. Pilot programs for cities undertaking new-type technological transformation and for digital transformation of small and medium-sized enterprises were organized to promote the transformation and upgrading of the manufacturing sector. The mechanism for safeguarding farmers’ income from grain production was improved, and a cross-provincial horizontal compensation mechanism between major grain-producing areas and major grain-consuming areas was established in a coordinated manner. Policies such as subsidies for the protection of cultivated land fertility were implemented. Central government funds for supporting rural revitalization continued to be maintained at a stable level, facilitating the successful completion of the transition period for consolidating and expanding the achievements of poverty alleviation and effectively linking them with rural revitalization. We advanced people-centered new-type urbanization and guided local governments in accelerating the granting of urban residency to people who have moved from rural areas. Policies on taxation of goods for the special customs of the Hainan Free Trade Port were formulated and issued to ensure the launch of the island-wide special customs operation as scheduled.

Third, we continued to strengthen support for people’s well-being. The employment-first policy was further implemented to help enterprises stabilize and expand employment. We promoted the expansion and improvement of educational resources, gradually advanced free pre-school education, promoted high-quality and balanced development of compulsory education and diversified development of senior high schools, and improved the student financial aid system. Demonstration projects for the reform and high-quality development of public hospitals were implemented in an orderly manner. Government subsidies for basic public health services and for basic medical insurance for urban and rural residents were further increased. The minimum standard per month for basic pensions for urban and rural residents was raised, and nationwide pooling and adjustment of basic pension insurance continued to be steadily advanced to ensure that pensions are paid in full and on time. A childcare subsidy system was established, and inclusive elderly care services were vigorously developed. Subsidy standards for entitled groups and others receiving preferential treatment were further raised. Central government disaster relief funds were promptly allocated for natural disasters. The public cultural service system was improved. Greater efforts were made to advance ecological protection and restoration, steadily promote carbon peaking and carbon neutrality, and continuously improve the quality of the ecological environment.

Fourth, we effectively prevented and defused risks in key areas. Government debt management was strengthened by coordinating central and local government debt, domestic and external debt, as well as debt issuance and management, so to establish a new framework for government debt management. A package of policies for defusing debt risks was earnestly implemented, with early utilization of debt resolution quotas and multiple measures adopted to reduce existing hidden debt. A high-pressure stance was maintained to resolutely curb the emergence of new hidden debt. The reform and transformation of local government financing platforms were accelerated. We ensured that more fiscal resources were directed to lower-level governments, improved institutional arrangements, and strengthened funding guarantees for the “three priorities” — people’s basic well-being, payment of salaries, and the normal functioning of government at the grassroots level. Coordinated efforts were made to advance reform and risk mitigation of small and medium-sized financial institutions. Local government special-purpose bonds were issued to support land reserves and the acquisition of unsold commercial housing for use as government-subsidized housing. 

Fifth, we deepened reforms in fiscal management. We continued to advance comprehensive reform of the fiscal and taxation systems, improved the budget system, deepened zero-based budget reform, promoted the development of a system of expenditure standards, and strengthened performance-based budget management. The tax system was improved by promoting the issuing of implementation regulations for the Value-Added Tax (VAT) Law and refining policies on VAT credit refunds. The fiscal framework was optimized by improving the transfer payment system, implementing incentive and constraint mechanisms for transfer payments that promote high-quality development, and deepening reform of the fiscal system below the provincial level. We upheld the principle that Party and government institutions must practice strict budget austerity, launched pilot programs for scientific fiscal management, strengthened fiscal and accounting supervision, and enhanced the overall effectiveness of fiscal governance.