Non-tax revenue drives up fiscal growth

China's government revenue is maintaining a relatively high growth speed despite a slowdown in the economy, with non-tax collections becoming the main driver of the expansion.

Among the 21 provinces that have published their fiscal data in the first four months this year, 17 have reported government income growing faster than 10 percent, with Tianjin leading the table at a growth rate of 27.3 percent.

According to the Ministry of Finance, the national fiscal income increased 12.5 percent in the first four months this year, when gross domestic product growth slowed to 8.1 percent in the first quarter.

The fiscal income growth rate was 18.9 percentage points less than that of the previous year, mainly because of retreating tax revenues that have decelerated 22.4 percentage points from last year.

However, non-tax revenue surged 52.8 percent in the first four months this year, becoming a main driver of the fiscal revenue increments.

A total of 188.9 billion yuan ($29.87 billion) more of non-tax revenues were collected in the first four months in 2012 compared with last year, which accounted for more than 40 percent of the fiscal income growth.

"Tax and fiscal revenue have always been key factors in the assessment of local governments," said Wang Yongjun, a researcher with the Central University of Finance and Economics.

"To maintain the fiscal income growth amid the economic slowdown and structural tax cuts, some local authorities will explore the potential in non-tax collections."