What’s new: Governments in China generated 11.2% less tax revenue in November than the same month last year, the third straight month of a decline, according to Caixin calculations based on data from the Treasury Department (link in Chinese) released on Friday.
China’s central and local governments suffered a total of 0.1% decline in tax revenues in October and 2.1% in September, according to the ministry. The ministry attributed last month’s cut to tax breaks the government gave to coal-fired companies, heating companies, and micro, small and medium-sized manufacturers.
Tax revenue was down 13.1% year-over-year in November, compared to a 2.2% decline in October, the data showed.
The background: On October 27, the State Council, China’s cabinet, announced that it would allow coal-fired power plants, heating companies, and micro, small and medium-sized manufacturers to defer their taxes for up to three months for the fourth quarter.
The decision, made when electricity shortages across China disrupted production and winter heating systems, was aimed at giving more financial leeway to companies hit by rising raw material prices and production costs, the State Council said.
See also: Cover story: How China ran into a huge energy shortage
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