Leaders call for further revisions to VAT reforms

China will continue to refine the value-added tax reform pilot program to enable further economic transformation and upgrades, a State Council executive meeting chaired by Premier Li Keqiang decided on Friday.

The reform was first piloted in Shanghai in 2012. It was expanded nationwide in May 2016. China's VAT rate structure was further cut from four to three tiers (6 percent, 11 percent and 17 percent) last month, with tax rates for farm produce, tap water and books reduced to 11 percent from 13 percent.

"The full implementation of the VAT reform pilot program is a strong pillar of this administration's efforts to boost the effectiveness of the proactive fiscal policy and the supply-side structural reform," Li said. "One year on, the reform is paying off. Sectors across the board have seen their tax burden reduced. It did not come easy."