Zhejiang to scrap Agriculture Tax
(China Daily)
Updated: 2004-02-18 00:03

Looking to boost farmers' incomes, Zhejiang Province plans to get rid of the Agriculture Tax.

The Agriculture Tax is a major part of farmers' taxation burden in the country's rural areas. Zhejiang could become the first province in the country to completely eliminate the tax, but experts expect other provinces to follow.

Farmers living in the coastal city of Ningbo were exempted from this tax as of January.The province's capital of Huangzhou will cancel the tax for its rural residents step by step and completely eliminate it by 2005.

"This is only a beginning. We plan to apply the policy to 3.7 million farmers next year," said Sun Jingmiao, the vice mayor of the Hangzhou municipal government.

Tax on grain and oil products will also be annulled this year, said Sun.

Some counties in good financial shape could annul the agriculture tax in 2004 for all farmers, regardless if they live in urban or rural areas, Sun added.

To date, however, there is no concrete timeline to eliminate the tax in the rest of the province.

The plan is just one of the measures the city plans to take to lower costs for farmers.

According to Sun, the plan will benefit farmers to the tune of 2 billion yuan (US$240 million).

Statistics from the Provincial Bureau of Statistics show that farmers' per capita income last year was 5,431 yuan (US$650).

"The implementation of the measure will reduce farmer's expenditures by 72 million yuan (US$8.60 million) every year," said Sun.

The city of Hangzhou began reforms on agriculture tax on July 1, 2002. It already reduced various taxes except the agriculture tax.

In Ningbo, the agriculture tax was annulled at the beginning of this year.

"There is a movement to annul the agriculture tax in the whole province in the near future," said Jiang Xiaobo, a senior official with the Bureau of Finance of Zhejiang Province.

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