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Delegate Wang Junjin: Provide ample space of development for small and micro enterprises
ReleaseDate: 2012-03-10

March 10, 2012, The Economic Daily, By Li Zhiguo

At present, many enterprises, especially SME enterprises, have met problems similar to capital bottleneck aspects in development. Delegate Wang Junjin put forward several suggestions:

Firstly, it is necessary to strengthen support of financial policies for enterprises, and effectively reduce enterprises’ labor cost. Enterprises currently have to shoulder too heavy social security burden, it is advised to consider paying the uniformly managed part in the social security levy with subsidies from government at all levels, and giving financial subsidy or direct reduction/exemption to enterprises participating in social security especially newly added social security quota imposed on SM Enterprises.

Secondly, it is necessary to intensify efforts in implementing structural tax reduction policy, and intensify efforts in boosting the growth of small and micro enterprises. The financial income growth of China’s local governments remained higher than GDP growth rate for 18 consecutive years since the tax system reform in 1994, whereas the percentage of tax revenue contributed by medium, small and micro sized enterprises, which account for over 90% of total enterprises in China and have absorbed a large number of job-seekers, is not high in the financial income. Therefore, it is advised to, through measures such as gradually raising tax threshold and lowering tax rates in a planned and staged way, continually alleviate actual tax burden of small and micro enterprises. It is recommended to reduce or exempt road toll and bridge toll fees, so as to reduce the shipping cost of enterprises especially small and micro enterprises.

Thirdly, it is necessary to intensify reform and innovation in the financial system, intensify support to enterprises’ financing. We should adhere to the essential requirements of finance serving real economy, adopt measures from multiple aspects, ensure capital is invested into the real economy, and effectively solve difficult financing and expensive financing problems in the real economy.

Intensify reform and innovation in the financial system, support private capitals with ability to participate in investing and establishing regional and local medium and small sized commercial banks such as township banks according to national laws and regulations, ensure fair access, allow private capital and state-owned capital to enjoy equal right in share-holding percentage.