Event: on May 17, the Ministry of Finance announced the financial revenue and expenditure from January to April. The national general public budget revenue was 7429.3 billion yuan, a year-on-year decrease of 4.8%; The national general public budget expenditure was 8093.3 billion yuan, a year-on-year increase of 5.9%.
Core conclusion: in April, the fiscal revenue of each caliber fell sharply, and the key cities almost fell by more than 30%. In addition to the tax rebate, it is related to the epidemic and also dragged down by the income from land transfer; Expenditure slowed down significantly, mainly due to a significant reduction in infrastructure expenditure and less issuance of special bonds. On the whole, the fiscal performance in April and the sharp economic downturn in April and the "halving" of social finance confirm each other, pointing out that the policy still needs to make every effort to stabilize growth, and the financial side is likely to increase efforts, especially the "incremental tools" such as national debt.
1. In April, fiscal revenue dropped sharply, and major taxes such as value-added tax, enterprise income tax and individual income tax fell sharply, mainly due to the retention of tax rebates, which is also related to the epidemic situation; Dragged down by infrastructure expenditure, fiscal expenditure slowed down significantly in April, but epidemic related expenditure still increased.
> the growth rate of general fiscal revenue fell sharply, mainly due to the retention of tax rebates and the impact of the epidemic. In April, the general fiscal revenue was 1.23 trillion, a year-on-year decrease of - 41.3%, the largest decline in history. From the perspective of attribution, the scale of tax rebate retained in April was about 800 billion. Due to the accounting treatment of hedging income, the corresponding tax revenue fell sharply (- 47.3%); Affected by the epidemic, the general fiscal revenue was - 4.9% year-on-year in the current month (3.4% in the previous month), which was also the first negative growth in the year.
> in terms of tax distribution, tax revenue fell sharply, and non tax revenue continued to increase. In April, the tax revenue was 986.7 billion, down 47.3% year-on-year, which was the main drag on fiscal revenue. The main reason was that the value-added tax revenue fell sharply by 124.7% due to the tax rebate. Among other taxes, the enterprise income tax changed from positive to negative to - 1.3%, which is related to the decline of enterprise operation and tax reduction under the impact of the epidemic; Personal income tax - 9.5%, negative growth for two consecutive months; The consumption tax is 14.3%, which may be related to the increase of relevant taxes caused by the high operation of crude oil prices; After returning to positive last month, the tax related to land and real estate turned negative sharply again this month to - 22%, pointing to the downturn of the real estate market. Non tax revenue was 238.9 billion, with a year-on-year increase of 10.3%, and continued to maintain double-digit growth, which may be related to the profit handover of the central bank and state-owned enterprises.
> General Fiscal Expenditure slowed down significantly, infrastructure expenditure was the main drag, and epidemic related expenditure such as health and health continued to rise. In April, the general fiscal expenditure was 1.73 trillion, a year-on-year increase of - 2.0% (14.4% in the previous month). In terms of main sub items, in terms of people's livelihood, the growth rate of health expenditure continued to rise by 3.5 percentage points (should be related to the epidemic), and the growth rate of education and social security expenditure fell by 18.2 and 15.3 percentage points respectively; In terms of infrastructure construction, urban and rural community affairs and transportation decreased by 18.5 and 15.0 percentage points respectively, with a total decrease of nearly 20 billion (34.7 billion in April), which dragged down the growth rate of overall expenditure by about 1.1 percentage points; The growth rate of debt interest payment expenditure changed from positive to negative, down 16.7 percentage points year-on-year, but the pressure of debt interest payment in the whole year is still large (according to our calculation, the scale of debt interest payment in the whole year is about 1.1 trillion). In terms of expenditure progress, the annual budget expenditure completed in April was only 6.5%, the lowest level since 2015.
2. In April, the income of government funds continued to decline, and land transfer was still the main drag; Expenditure slowed down, mainly due to less issuance of special bonds
> on the revenue side, the revenue of national government funds in April was 0.37 trillion, a year-on-year decrease of 34.4%, which was further widened compared with the previous month. Among them, the revenue from the transfer of local state-owned land use rights decreased by 37.9% year-on-year, which was the main drag. Over the same period, the land purchase area fell sharply by 57.3%, and the decline was wider than that of the previous month. Although the real estate has been loose recently, from the high-frequency data, the real estate sales in the first two weeks of May are still sluggish (down 52% year-on-year), and the land acquisition by developers is not optimistic. Considering the deferred recognition of land transfer income, the income of short-term government funds will continue to be under pressure.
> on the expenditure side, the national government fund expenditure in April was 0.67 trillion, an increase of 12.5% year-on-year and a sharp decrease of 56.6 percentage points compared with the previous month. On the one hand, it may be due to the impact of the epidemic and the slowdown of project construction, on the other hand, it should be related to the slowdown of the issuance pace of special bonds (the special bonds increased by only about 100 billion in April, and the total issuance from January to march was nearly 1.3 trillion). In terms of expenditure progress, 4.8% of the annual budget expenditure was completed in April, the lowest level in recent three years.
III. at the local level, the fiscal revenue of key cities fell sharply in April, with most falling by more than 30%. For the seven key cities (Nanjing, Suzhou, Hangzhou, Ningbo, Chongqing, Wuhan and Guangzhou) with published data, only Guangzhou's fiscal revenue increased positively (but only 1.2%), and the other six cities had negative growth; In the current month, the fiscal revenue of the seven cities showed negative growth, with an average decline of - 36.5%. Among them, except Guangzhou - 12.8%, the other six cities also had the smallest decline of - 29.8%. It should be noted that Nanjing (- 54.9%), Suzhou (- 49.6%), Hangzhou (- 37%) and Ningbo (- 36%) had the largest decline. In addition to the serious epidemic in Suzhou itself, it should be related to the epidemic in Shanghai.
IV. on the whole, the fiscal performance in April is confirmed by the sharp economic downturn in April and the "halving" of social finance. It reflects that the current economic pressure is great, and the follow-up policies need to make every effort to stabilize growth. Among them, as an important means of counter cyclical regulation, fiscal policy is likely to make further efforts, especially the "incremental tools" such as national debt. Specifically, there are four major directions for the follow-up Finance: first, according to the latest deployment of the May 15 regular session, the primary task of monetary and fiscal policy is to stabilize employment, and it is expected that the retention tax rebate, tax reduction and fee reduction will be accelerated; Second, the pace of special bond issuance is expected to accelerate, with the pace ahead; Third, given that the current epidemic has exacerbated the contradiction between fiscal revenue and expenditure and other factors, the funding gap for steady growth may become larger. Objectively, it is necessary to issue new means such as special treasury bonds and better coordinate with monetary policy; Fourth, the reform of financial system and mechanism is expected to be further accelerated, such as the reform of financial system below the provincial level.
Risk warning: unexpected changes in epidemic situation, policy strength, external environment, etc
