China cuts growth target to 6-6.5%
Saibal Dasgupta | TNN | Mar 6, 2019, 07:18 IST
Chinese President Xi Jinping, left, and Chinese Premier Li Keqiang. (AP)BEIJING:China on Tuesday scaled down its growth target for 2019 in the face of uncertainties over the trade war with the US. It has also unveiled an indirect stimulus package rewarding businesses with a tax cut bonanza worth nearly $300 billion.
Chinese premier Li Keqiang has cautiously set the growth target for 2019 in the range of 6% to 6.5% of gross domestic product (GDP). The economy grew 6.6% in the midst of a corrosive trade war for past eight months. It achieved 6.8% in 2017.
Value added tax (VAT) has been cut from 16% to 13%. In two sectors — transport and construction — VAT will be even lower in the 9-10% range.
The tax cut is meant to help Chinese businesses absorb some of the damages they have suffered during the trade war and brace against uncertainties in the coming months. A deal to end the trade war with the US is on the table but the final outcome remains uncertain.
Chinese premier Li Keqiang has cautiously set the growth target for 2019 in the range of 6% to 6.5% of gross domestic product (GDP). The economy grew 6.6% in the midst of a corrosive trade war for past eight months. It achieved 6.8% in 2017.
Value added tax (VAT) has been cut from 16% to 13%. In two sectors — transport and construction — VAT will be even lower in the 9-10% range.
The tax cut is meant to help Chinese businesses absorb some of the damages they have suffered during the trade war and brace against uncertainties in the coming months. A deal to end the trade war with the US is on the table but the final outcome remains uncertain.
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