Rural areas 'must be strengthened'
By Liu Li and Xiao Zhao (China Daily)
Updated: 2005-12-30 05:50

To boost agricultural growth and ensure rural stability, the basic management system of rural land must be adhered to, and using the land for construction purposes will be strictly prohibited, the statement said.

It also said farmers-turned-migrant-workers must be treated fairly.

Meanwhile, the Standing Committee of the National People's Congress (NPC), China's top legislature, voted yesterday to abolish the agricultural tax regulation. The motion won the support of 162 legislators with one abstaining.

The State Council had earlier decided not to collect agricultural tax from next year.

"The government could merely reduce or remit taxes. Only the NPC has the right to abolish agricultural tax," Wu Bangguo, chairman of Standing Committee of NPC, said yesterday in his closing speech of the six-day session.

"Our decision today will reassure farmers," he said.

Chinese farmers are expected to be brought under a unified tax system for rural and urban areas.

Official figures show that agriculture contributed to 13.1 per cent of the nation's gross domestic product (GDP) in 2004, with industry and tertiary trade making up 46.2 per cent and 40.7 per cent respectively.

Agricultural tax has been levied in China since 594 BC and collected for 2,600 years.

In 1958, the NPC adopted the regulation on agricultural tax.

In March 2004, Premier Wen Jiabao announced in his annual government work report that the Chinese Government would reduce agricultural taxes year on year before they were abolished.

Since then, 28 provinces, municipalities and autonomous regions have exempted agricultural taxes, reducing a tax burden worth 50 billion yuan (US$6.2 billion) for 800 million farmers.

As local revenues will decrease with the abolition of agricultural tax, the central government will provide assistance to major grain producing areas and central and western regions, sources said.

(China Daily 12/30/2005 page1)