China's fiscal revenue in May rose 4.8% or 30.132 billion yuan year on year to 656.95 billion yuan, among which, the central government revenue was 406.343 billion yuan, up 5.7%, and local government revenue was 250.604 billion yuan, up 3.3%, according to a release by the Ministry of Finance.    

Consumption tax revenue increased 9.1% in May, indicating the government policy of stimulating internal consumption is working, or at least is showing some impact.  Sales tax revenue increased 14%, indicating China's business activities are booming, a good sign that is consistent with other indicators that China's economy is turning around.  On the other hand, the value-added tax revenue dropped 4.7%, corporate profit tax decreased 8.9%, import value-added tax revenue eased 18.9%, custom tax revenue dropped 36.9%, and securities trading tax abated 39.8%.  All indicated the economic recovery is still weak.

In the first five months of this year, total fiscal revenue fell 6.7 percent to 2,710.867 billion yuan, accounted for 40.9% of the total expected revenue, among which, tax revenue fell 9.4% to 2,404.651 billion yuan, and non-tax revenue increased 21.2% to 306.216 billion yuan. 

The ministry attributed the revenue decline to the following: shrinking business profits due to the slow economy; active fiscal policies including tax cuts and increased export tax rebates to boost economic growth; and negative CPI and PPI.

Fiscal expenditures climbed 14.5% to 460.801 billion yuan in May. The cumulative expenditure from January to May amounted 2,249.698 billion yuan, up 27.8%, or 488.717 billion yuan from the same period of last year.  Expenditures jumped 93.5% on environmental protection, 89.9% on agriculture and forestry, and 80% for transportation.