China plans tax cuts to spur consumption

People gather to celebrate the New Year at the Temple of Heaven, Beijing's historic landmark, on January 1, 2012. Spectacular fireworks and crowded parties will ring in the New Year for revelers around the world, as billions mark the end of 2011 with noisy celebrations.
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BEIJING - China's finance minister says the government plans tax cuts this year to spur domestic consumption and economic reforms.

Xie Xuren said at a news conference Tuesday that changes in the tax system should decrease charges on companies. He said the government also will reduce import duties on energy and raw materials and taxes on some business activities.

Xie said the changes are aimed at raising the after-tax income of companies and the Chinese public to encourage more consumption.

The government is trying to boost consumer spending and other domestic consumption to reduce reliance on exports and investment.

Last year, Beijing changed its personal income tax system to exempt tens of millions of workers by raising the minimum tax paying threshold.