China fiscal revenue growth slows to 12.8% in 2012

China's Ministry of Finance has released the country's 2012 fiscal condition on Tuesday. Fresh data shows fiscal revenue growth slowed sharply in 2012 due to slower growth and generous tax breaks.

China's fiscal revenue rose 12.8 percent year-on-year to 11.7 trillion yuan, or about 2 trillion U.S. dollars, a growth rate that's nearly 12-percent lower versus 2011.

At the same time, China's fiscal spending increased 15.1 percent year-on-year to 12.6 trillion yuan. Doing the math, that puts China in a fiscal deficit last year of around 850 billion yuan, or 1.6 percent of GDP, slightly higher than the government's target.

In 2012, China tilted more spending towards rural areas and increased spending on education and social welfare programs.

Liu Shangxi, deputy director of Research Institute for Fiscal Science of Ministry of Finance, said, "The pressure on fiscal expenditure is very heavy, and the trend will last throughout this year. On the one hand, we need to control the fast growth of fiscal spending, and adjust the spending structure. On the other hand, we need to improve the rates of return on these spendings. Only then can we ease the pressure."