Macroeconomic governance system key to boosting high-quality growth

The central authorities have recently vowed to improve the systems of macroeconomic governance, advance reforms in fiscal, taxation, financial and other key areas in a coordinated manner, and enhance the consistency of macro-policy orientation.

China should improve the national strategic planning system and policy coordination mechanism. To this end, it should build a mechanism for the formulation and implementation of national strategies, strengthen the deep integration of major national strategies, and enhance macro guidance and overall coordination of these strategies.

Over a period of time, China's economic operation has been affected by unstable expectations and lack of confidence of some market players, which has affected the effectiveness of relevant policies to expand domestic demand.

The country needs to improve the expectation management mechanism and the system of experts' participation in public decision-making, to achieve mutual information communication between the government and market in the decision-making process and let decision-making fully reflect the professional opinions. This will help reach policy consensus, stabilize expectations and enhance confidence.

In the past, China's macro-regulation was mainly manifested as countercyclical regulation, mainly through the coordination of monetary and fiscal policies. However, over time, monetary and fiscal policies have become tools to stimulate economic growth. Therefore, at a time when China is promoting the organic combination of cross-cycle and countercyclical policies to achieve economic balance and structural optimization, there is greater necessity to reform its fiscal, tax and financial systems.

The country needs to improve the budget system, strengthen fiscal resources and budget coordination, and bring all revenue derived from administrative power, government credit, and State-owned resources and assets into government budget management. It should also set up a tax system conducive to high-quality development, social fairness, and market unification, optimize the structure of the tax system, improve the direct tax system, and improve the comprehensive and classified personal income tax system.

The focus of the reform of fiscal and tax systems is to establish a fiscal relationship between central and local governments. It should help increase local governments' fiscal resources and expand local tax sources while increasing the proportion of central fiscal expenditure, as taxation and finance are the two most important areas of macroeconomic governance, and it is urgent for China to establish a modern fiscal and taxation system and a more market-efficient financial system based on the rule of law in order to promote high-quality development.

21ST CENTURY BUSINESS HERALD