An important document involving trillions of yuan of land transfer income and expenditure has finally been issued.
Recently, the general offices of the General Office of the Central Committee of the CPC and the State Council issued the Opinions on Adjusting and Perfecting the Use Scope of Land Transfer Income to Give Priority to Supporting Rural Revitalization, requiring that by the end of the 14th Five-Year Plan period, the proportion of local land transfer income used for agriculture and rural areas should reach more than 50%.
Land transfer income is an important part of the budget income of local government funds. For a long time, land value-added income has been taken from agriculture and mainly used in cities, which has effectively promoted the rapid development of industrialization and urbanization, but the proportion of direct use in agriculture and rural areas is low, and its supporting role in agricultural and rural development is not enough.
Therefore, in accordance with the requirements of "taking it from agriculture and mainly using it for agriculture", the Opinions require adjusting the urban-rural distribution pattern of land transfer income and steadily increasing the proportion of land transfer income used for agriculture and rural areas.
According to the current relevant regulations, local financial departments at all levels should allocate not less than 15% of the land transfer income for agricultural land development, 10% for farmland water conservancy construction and 10% for education funds (mainly for rural basic education).
Although the proportion of the above three items totaling 35% seems not low, considering that the land transfer income is far less than the total land transfer income (land transfer income = land transfer income+cost expenditure+related taxes and fees), the total amount of this income used for agriculture and rural areas in recent years is actually relatively small.
In 2012, Han Jun, who was then the deputy director of the State Council Development Research Center, wrote an example in Farmers Daily, pointing out that the distribution of land income was obviously tilted towards cities. In 2011, the income from land transfer fees exceeded 3.15 trillion yuan, and by the end of October 2011, the expenditure on agriculture, rural areas and farmers from land transfer income was only 123.4 billion yuan.
How to provide more abundant financial guarantee for the current rural revitalization and adjust the use direction of land transfer income has become an important option for the central government.
On April 13th, the rural scenery was shot on the outskirts of Fengxiang Town, Bozhou District, Zunyi City, Guizhou Province. Xinhua news agency.
The "Opinions" require that from the first year of the "14 th Five-Year Plan", all provinces (autonomous regions and municipalities directly under the Central Government) steadily increase the proportion of land transfer income used for agriculture and rural areas; By the end of the "Fourteenth Five-Year Plan" period, accounting by province (autonomous region or municipality directly under the Central Government), the proportion of land transfer income used for agriculture and rural areas reached more than 50%.
After the tax-sharing reform in 1994, in order to alleviate the local financial pressure, the central government determined the system design that the land transfer income basically belongs to the local government, and it has continued to this day. Since then, apart from collecting relevant taxes and fees, the central level cannot control the expenditure of local land transfer income in real time.
In this case, how to restrain local governments to effectively use the land transfer income more for agriculture and rural areas, and achieve the goal of 50% proportion?
This document of the Central Committee has also considered this kind of situation and made a more specific system design.
The "Opinions" stipulate that the accrual method shall be determined by provinces (autonomous regions and municipalities directly under the Central Government). Provinces (autonomous regions and municipalities directly under the Central Government) can choose one of the following two ways to organize the implementation according to local conditions:
First, according to the proportion of funds used for agriculture and rural areas in the land transfer income in that year, it will be withdrawn gradually. If the withdrawal amount is less than 8% of the land transfer income, it will be withdrawn at least 8% of the land transfer income; Second, according to the proportion of land transfer income used for agriculture and rural areas in that year, it was gradually accrued to more than 10%.
The "Opinions" also specifically stipulates that in a few areas such as Beijing and Shanghai, where land transfer income is high and agricultural and rural input demand is small, the specific proportion of increasing land transfer income for agriculture and rural areas can be determined according to actual needs.
A closer look at these two ways involves the specific proportion of land transfer income, one is 8% and the other is 10%. In other words, no matter what the net income from land transfer is, the minimum proportion of local government land transfer income used for agriculture and rural areas is set at 8%.
Why is the system designed like this? The main reason is that the income from land transfer is convenient for accurate statistics, while the net income is sometimes difficult to calculate accurately.
What is the income from land transfer? Simply put, it is the sum of land transfer fees successfully transferred by local governments. In recent two or three years, China’s annual land transfer income has reached the scale of six or seven trillion yuan. For example, it was 6,509.6 billion yuan in 2018 and 7,251.7 billion yuan in 2019. As far as cities are concerned, the land transfer income of hot cities such as Hangzhou has exceeded 200 billion yuan/year in recent years.
If roughly calculated according to the minimum 8% of land transfer income in 2019, the total amount of funds used for agriculture and rural areas in that year will be as much as 580 billion yuan.
The income from land transfer is calculated by subtracting the compensation expenses for land acquisition and demolition, the development expenses in the early stage of land transfer, and the expenses for subsidizing land-expropriated farmers from the total amount of six or seven trillion yuan. The above expenses are the costs paid in advance by the government in the collection, storage and land consolidation.
Over the years, the cost of land acquisition and demolition has increased a lot, which correspondingly reduces the proportion of land transfer income in the whole land transfer fee.
In addition, it is precisely because the central government has set the designated use of some land transfer income that it does not rule out that some places deliberately raise the cost of land transfer in order to avoid the above purposes, thereby reducing the net income.
A land expert once told CBN that some local governments will reduce the net income of land transfer. Once the net income of local land transfer is reduced, it means that local governments can reduce the expenses for the above-mentioned major projects. In order to keep more places, many other expenses may be counted into the cost, such as greening the surrounding land and building municipal roads.
This kind of situation is obviously within the decision-making consideration of the central government. The "Opinions" require that the cost of land transfer should be strictly verified, and the construction costs of infrastructure and public welfare projects unrelated to the early development of land should not be included in the cost accounting scope, thus inflating the cost of land transfer and reducing the income from land transfer.
As can be seen from the above two ways of accrual, the reason why the total amount of accrual accounts for the minimum proportion of land transfer income (8% and 10%) is also that there will be inaccuracies in local land transfer income whether due to objective factors or subjective wishes, which will further affect the operability and supervision difficulty of 50% ratio.
According to the proportion of 8%, it can be found that in 2011, the income from land transfer fees was 3.15 trillion yuan, and the expenditure on agriculture, countryside and farmers accrued in that year should reach 250 billion yuan, which may be twice the actual expenditure in that year (123.4 billion yuan in the first 10 months of 2011).
From the point of view, the strength of this reform can be seen, but it also means that its promotion is not difficult.
The "Opinions" emphasize that the adjustment and improvement of the use scope of land transfer income and the increase of the proportion used for agriculture and rural areas should be included in the performance assessment of the implementation of the rural revitalization strategy as an important part of the supervision of the implementation of the No.1 Document of the Central Committee. Seriously investigate and deal with unauthorized relief, interception, misappropriation, misappropriation of land transfer income payable to the state treasury, inflated land transfer costs, illegal use of investment funds in agriculture and rural areas, and investigate the responsibilities of relevant responsible persons according to laws and regulations.
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