Beijing closed out 2025 with broadly stable tax receipts, targeted social spending and an aggressive push to deploy bond finance to reignite growth, the finance ministry said at its year-end briefing. National general public budget revenue totaled 21.6 trillion yuan, down 1.7% from 2024, while tax receipts edged up 0.8% to 17.64 trillion yuan. Non-tax revenue fell sharply after a 2024 one-off central transfer boosted the prior-year base.
Public spending rose modestly, to 28.74 trillion yuan, about 1% higher than a year earlier, widening the gap between revenues and expenditures. Central government outlays grew faster than local spending, reflecting a deliberate move to use central reserves and targeted transfers to support priority areas. Local budgets nevertheless recorded a 2.4% rise in their own revenues and 27 of 31 provincial-level jurisdictions saw year-on-year increases, underscoring a geographically broadening recovery.
Sectoral tax receipts point to a shifting Chinese economy. VAT and corporate income tax were both positive contributors, and tax collection from higher-tech and service-oriented industries led growth: computer and communications equipment manufacturing (+13.5%), scientific research and technical services (+14.3%), and electrical machinery (+8%). These patterns suggest stronger activity in advanced manufacturing and modern services even as commodity-sensitive regions struggled.
Beijing also tapped bond-financed channels to an exceptional degree. Governmental fund budget spending rose 11.3% to 11.29 trillion yuan while fund revenues fell 7% to 5.77 trillion. The ministry highlighted a 6.19 trillion yuan deployment of longer-term special sovereign bonds, local government special-purpose bonds and central injections via financial institutions — a 37.6% increase year-on-year — aimed at accelerating projects and boosting domestic demand.
A headline-policy for 2025 was the introduction of a broad, cash childcare subsidy described by officials as the largest direct, universal-facing welfare payment in the PRC’s history. Some 100 billion yuan was earmarked nationally for the scheme, with the central government allocating 90.4 billion yuan; roughly 30 million infants and toddlers have already received payments. The subsidy is tax-exempt, universal across regions and income groups, and officials have pledged to complete outstanding disbursements by March 2026.
Taken together, the fiscal package reflects a dual strategy: shore up consumption and social supports to address long-term demographic and demand weak spots, while mobilizing bond-financed investment to stabilise short-term growth. That mix reduces near-term political and economic risk but increases reliance on debt instruments to fill the gap between revenues and expenditures. How effectively provinces deploy the bond proceeds, and whether higher-tech sectors can sustain tax-driven momentum, will determine the resilience of China’s recovery into 2026.