The year 2026 marks the beginning of the 15^th Five-Year Plan (2026-2030) period. In the face of risks and challenges arising from the complex environment at home and abroad, the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at its core strengthened its overall leadership over economic work. All regions and departments, guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implemented the guiding principles of the 20^th CPC National Congress and all plenary sessions of the 20^th CPC Central Committee, and conscientiously carried out the arrangements made at the Central Economic Work Conference and the Government Work Report. We fully implemented the new development philosophy in an accurate and comprehensive manner, and carried out in a deep-going way the education campaign for establishing and practicing a correct understanding of governance performance, and implemented more proactive and effective macro policies. China's economy sustained a development trajectory marked by new growth drivers, an optimized structure, and solid progress in high-quality development. The fiscal policy was made more proactive and better targeted, and coordination with other policies was strengthened, laying a solid foundation for a good start to the 15^th Five-Year Plan period.

First, we continued to unleash the potential of domestic demand. This year, the central government allocated 100 billion yuan to introduce an innovative package of fiscal-financial coordination policies to boost domestic demand. The package comprised measures including interest subsidies on individual consumption loans, interest subsidies on loans to business entities in the service sector, interest subsidies on loans to micro, small and medium-sized enterprises, interest subsidies on loans for equipment upgrades, a special guarantee program for private investment, and a risk-sharing mechanism for bonds issued by private enterprises, so as to guide financial resources and social capital toward key areas for expanding domestic demand. We continued to implement the consumer goods trade-in program and adjusted and optimized its scope and subsidy standards. Fifty cities were selected for the pilot reward-based invoice program, generating over 300 billion yuan in sales in catering, accommodation, tourism and other related fields. We supported pilot programs for new consumption formats, models and scenarios, deepened the development of international consumption center cities, and created a more convenient and comfortable consumption environment. We made coordinated use of funds from ultra-long-term special treasury bonds, special-purpose bonds and central government budgetary investment, with a focus on key areas, to improve the quality and efficiency of investment.

Second, we supported the accelerated cultivation and growth of new drivers of economic development. We enhanced the capacity for systematic breakthroughs in scientific and technological innovation. The central-level expenditure on science and technology for 2026 was budgeted to increase by 10 percent, with greater focus on basic research, applied basic research and national strategic sci-tech tasks, and stronger support for national laboratories, national research institutions and high-level research universities. We underscored the principal position of enterprises in innovation and advanced the development of a modern industrial system. A total of 200 billion yuan of ultra-long-term special treasury bond funds was allocated to support equipment upgrades in over 11,000 projects across 22 fields. We carried out pilot programs for new-type technological transformation in manufacturing cities and added 30 cities to the program. Twenty cities were included in the third group of pilot cities for developing a modern commercial distribution system, and 10 cities were included in the first group of cities supported under the new round of initiatives to shore up weak links and strengthen key segments of national comprehensive freight hubs. We advanced the standardization of preferential tax policies and fiscal subsidy policies in support of the accelerated development of a unified national market. We carried out in depth the special campaign to address violations of laws and regulations in the field of government procurement and strengthened the oversight of electronic marketplaces.

Third, we intensified efforts to ensure and improve people's livelihoods. We extended time-limited measures such as social insurance subsidies and job stabilization rebates to promote employment for key groups including college graduates. We improved the quality of public education services, optimized the structure of basic education expenditure, supported efforts to enhance the capacity of vocational education, and fully implemented student financial aid policies. We continued to raise the per-capita fiscal subsidy standard for basic medical insurance for urban and rural residents, supported the implementation of the initiative to strengthen the foundations of medical and health services, and accelerated the establishment of a long-term care insurance system. The central government continued to increase subsidies to the basic pension insurance fund to support local governments in ensuring the timely and full payment of basic pensions. We fully implemented the childcare subsidy system, issued elderly care service consumption subsidies to seniors with moderate to severe functional impairment, and ensured funding for subsistence allowances, assistance and support for people in extreme difficulty, and preferential treatment and resettlement for ex-service members. We enhanced capacity for disaster prevention, mitigation and relief, promptly activated the rapid allocation mechanism for central disaster relief funds, and responded effectively to earthquakes, typhoons, floods and geological disasters.

Fourth, we promoted urban-rural integration and regional coordination. We strengthened the coordination and integration of agriculture-related transfer payments, and advanced the development of high-standard farmland and the protection of black soil. The central government allocated 177 billion yuan in regular assistance funds to support industrial assistance, employment assistance and development-oriented assistance in underdeveloped areas. We advanced people-centered new-type urbanization and improved the system under which basic public services are provided by places of habitual residence. We made solid progress in implementing major regional strategies and the coordinated regional development strategy, and applied a mix of policies including incentive funds for promoting high-quality development to guide localities in giving play to their comparative advantages.

Fifth, we promoted the green and low-carbon transition. We introduced trial implementation measures for levying the environmental protection tax on volatile organic compounds. We deepened the development of cross-basin horizontal ecological protection compensation mechanisms. We strengthened comprehensive ecological and environmental governance, and the central government allocated 61.8 billion yuan in subsidy funds to fully support the battles for blue skies, clear waters and clean soil. We launched nine cross-provincial Shan-Shui initiative projects and continued to support the critical campaign for the Three-North Shelterbelt Forest Program. We made active and prudent efforts toward carbon peaking and carbon neutrality goals and promoted the adjustment and optimization of the energy structure.

Sixth, we effectively prevented and defused risks in key areas. We supervised and guided localities in making good use of the central government's debt resolution support policies and accelerating the resolution of existing hidden debt. We deepened cross-departmental regulatory coordination and held those involved strictly accountable for such acts as incurring new hidden debt and falsifying debt resolution. We advanced the consolidated supervision of hidden debt and statutory debt and strengthened comprehensive monitoring of local government debt. We advanced the reform and transformation of local government financing platforms. Central government transfer payments to local governments totaled 10.42 trillion yuan as initially budgeted for the year, of which 9.4 trillion yuan had been allocated in the first half of the year. We stepped up the monitoring of local fiscal operations and consolidated the bottom lines for the "three priorities", namely people’s basic well-being, payment of salaries, and the normal functioning of government, at the grassroots level.

Seventh, we deepened fiscal reform and management. We strengthened the alignment of supporting measures to ensure the smooth implementation of the VAT Law and its implementing regulations. We improved the local tax system and steadily advanced legislation on local surtaxes. We improved the transfer payment system and launched pilot programs for the integrated and coordinated use of transfer payment funds. We guided localities in advancing reform of the fiscal system below the provincial level. We further advanced pilot programs for scientific fiscal management and continuously made fiscal management more systematic, refined, standardized and law-based. We intensified fiscal and accounting supervision and launched the three-year action to enhance the quality and efficiency of fiscal and accounting supervision. We upheld the principle of practicing strict budget austerity and ensured that fiscal funds were used where they were most needed for development and where they mattered most for people's wellbeing.