The spring of manufacturing is really coming

Premier Li Keqiang pointed out in the government work report: "we should develop both inclusive tax reduction and structural tax reduction, focusing on reducing the tax burden of manufacturing industry and small and micro enterprises. We will deepen the reform of value-added tax and reduce the current tax rate of 16% in manufacturing industries to 13%... " Just a few lines, but repeated applause. This tax reduction "gift package" inspired many delegates, committee members and journalists present, and some entrepreneurs said: "the spring of China's manufacturing industry is coming!"

In recent years, with the increasing downward pressure of the economy and the aggravation of the global economic fluctuation, the development of manufacturing enterprises is inevitably affected. At the same time, in the process of transformation and upgrading, reform and innovation, enterprises are facing the impact of adverse factors such as sharp decrease of demographic dividend and increase of operating costs. Manufacturing industry has faced unprecedented challenges. A series of large-scale tax reduction and fee reduction measures in the government work report are the decisions made by the Party Central Committee and the State Council in view of the existing problems and difficulties in the manufacturing industry, and are also a "timely rain" to promote the construction of a manufacturing power.

On March 28, 2018, Premier Li Keqiang presided over the executive meeting of the State Council and decided to reduce the VAT rate of manufacturing industries from 17% to 16% from May 1, 2018. This year's "big gift package" of tax reduction and fee reduction of the NPC and CPPCC is another tax reduction and fee reduction following last year's tax reduction policy.

He Lifeng, director of the national development and Reform Commission, pointed out in a press conference at the second session of the 13th National People's Congress on March 5 that in previous years, the scale of tax reduction and fee reduction exceeded 1 trillion yuan per year. On March 4, Premier Li Keqiang put forward in the government work report that the scale of tax reduction and fee reduction this year will be nearly 2 trillion yuan, which is unprecedented in the history of China's economic development. The implementation of these measures will further stimulate the vitality of market players.

Undoubtedly, the implementation effect of tax reduction and fee reduction will first be reflected in the cost of enterprises. It is understood that in addition to production and operation, employment, scientific and technological innovation, the cost of some enterprises also accounts for a large proportion of taxes, and some of them are even higher than the profit value. Since last year, the state began to reduce the value-added tax rate by 1%, which has brought substantial burden reduction and cost reduction to enterprises. This year, the tax rate of the "gift package" for tax reduction has dropped by 3%, which is the focus of the state in optimizing the tax structure, serving economic growth and the transformation of the mode of economic development, and better promoting the adjustment of economic structure.

In addition, the implementation effect of tax reduction and fee reduction will also be reflected in the transformation and upgrading. In the transformation and upgrading of traditional industries, especially traditional manufacturing industries, a large amount of financing is needed in the aspects of scientific and technological research and development, new equipment, merger and acquisition, etc. the tax and fee brought by financing is also one of the burdens of manufacturing enterprises. This tax reduction and fee reduction can better promote the transformation and upgrading of enterprises, accelerate the transformation of new and old kinetic energy, and enable enterprises to better cope with the complex and changeable economic situation.

Moreover, the implementation effect of tax reduction and fee reduction will be more reflected in innovation and development. In the government work report, it is pointed out that "we should strengthen the industrial foundation and technological innovation ability, promote the integrated development of advanced manufacturing industry and modern service industry, and accelerate the construction of a manufacturing power." Tax reduction and fee reduction can not only alleviate the pressure of enterprises, but also promote enterprises to put more costs on scientific and technological innovation and cultivate new economic growth points, so as to help enterprises drive scientific and technological innovation into the "fast lane".

It can be said that this large-scale tax reduction and fee reduction is an important reform of the state in improving the tax system and optimizing the pattern of income distribution. It is a major choice for macro policies to support stable growth, protect employment and adjust the structure. It is also a strong support for promoting made in China to move forward to China's creation.