The first Spring Festival where people can travel freely across the country since the COVID-19 pandemic has led to people eating out. For example, 308 million domestic trips were made during the seven-day holiday that just ended, up 23.1% year-on-year, according to the Ministry of Culture and Tourism. This means that the travel share has returned to 88.6 percent of the 2019 level.
In 2022, due to the increasing but slow spread of various types of coronaviruses and their subtypes, China’s economy was in a triple crisis due to demand, disruption, and low expectations – not to mention the difficulties and problems of the foreign economy. the environment.
But in order to change things, the central and central governments have made an effort to establish a prudent monetary policy, while using the national economic policy, to help increase domestic demand and strengthen the real economy. Also, with the easing of restrictions during the COVID-19 pandemic, domestic demand and market expectations have risen.
So far, the authorities are focusing on the growth of domestic consumption and promoting China’s market economy on the road to building a modern socialist country in all directions.
First, China has extended the period for financing businesses by announcing tax cuts, helping to boost consumption and improve people’s lives. In January, the Ministry of Finance and the State Administration of Taxation reduced all taxes, including additional value added tax (VAT) deductions, for small taxpayers, adopting appropriate policies to meet the needs of market players.
In 2022, the tax authorities returned 2.4 trillion of VAT to taxpayers, which is 3.7 times the 3.7 times the tax refund for the whole year of 2021. In addition, the newly raised tax reduction and regulatory payments reached 884 billion yuan, with tax. and cut wages totaling 733.1 billion yuan.
China has also provided a consumer market with policy support. For example, in the second half of 2022, the purchase tax was reduced by half for passenger cars that cost 300,000 or less and the displacement volume is less than 2.0 liters. Also, the exemption of purchase tax on new energy vehicles will continue until the end of this year.
The policy of tax cuts and tax exemptions will directly benefit consumers, as they will reduce the cost of cars and other goods, and speed up the recovery of businesses. This policy has not only increased market confidence, but also supports the advanced development of the automotive industry.
Second, the market’s huge development potential and pent-up demand have been released to some extent. Comparing the global consumer price index (CPI) and the industrial price index (PPI) for 2022, we can see that the price level continues to rise, and domestic consumption is expected to increase gradually.
The fact that some people like to save a rainy day as a plague does not mean that people are afraid or hesitant to save the amount of food in 2023. economic recovery.
In order to stimulate the consumer market and stimulate demand, many local governments have issued various types of shopping coupons that, for example, can be used in restaurants, home appliances and retail stores, or to buy a car.
While the Zhengzhou government in Henan province distributed 15 million worth of shopping vouchers for home appliances in January, the Shenyang government in Liaoning province has given out 100 million worth of Spring Festival vouchers.
Many other local governments, too, have distributed small coupons for consumption and participation through platforms such as Alipay, Douyin and Meituan. As a result, the Chinese people’s tendency to “save, not spend” has changed a bit, and there may be a further increase in the short term, as consumers become more confident as the economy improves.
In addition, the Central Economic Work Conference has listed increasing domestic demand as the most important task in 2023, and it made people suffer, improve people’s lives in rural and urban areas, and promote green development, for example by promoting the sale of electric cars. required in the year 2023.
But there is also a need to encourage parties to integrate and promote traditional uses in areas such as cars, household appliances, household appliances and food, because this encourages the healthy and systematic development of new types of food, as well as the integration of the Internet. and online services.
In order to promote urban retailing, government officials need to plan activities to promote food consumption and economic growth.
It is also important to rely on financial and financial methods to increase revenue and ensure that the money is working for the business. And great efforts should be made to stabilize and expand the size and structure of foreign trade to promote the high development of the country’s economy.
The author is the deputy director of the Department of Strategic Philosophy, Party School of the Communist Party of China Central Committee.
The views do not represent those of China Daily.