China today said its total fiscal revenue grew by 21.3 per cent to net 8.31 trillion yuan ($1.26 trillion) last year, while its GDP grew by an impressive 10.3 per cent making the Chinese economy bigger than that of Japan.
The increase in revenue is due to relatively fast economic growth, surging purchases and consumption tax, driven by growing vehicle sales, Chinese Finance Ministry said in a statement today.
Various figures put China's scale of economy bigger than Japan's last year, state-run People's Daily said.
It also claimed that inflation has tapered to 4.6 per cent last month from the 28 month-high of 5.1 per cent November last.
Analysts say that the new figures showcasing China's economic might add more bargaining power to its President Hu Jintao, who is currently on a fence mending visit to the US.
According to a media report Japan's 2010 gross domestic product data won't be released until February, but that it's almost certain to be lower than that China's.
China witnessed a buoyancy in its revenue last year as the central fiscal revenue topped 4.25 trillion yuan, up 18.3 per cent from the previous year, while local governments collected 4.06 trillion yuan, up 24.6 per cent, official Xinhua news agency quoted the Ministry statement as saying.
Also, tax revenues rose 23 per cent last year from 2009 to 7.32 trillion yuan ($1.2 trillion).
Meanwhile, fiscal expenditure nationwide grew 17.4 per cent to nearly 8.96 trillion yuan in 2010.
The double-digit economic growth last year marks the fastest annual expansion since the onset of the global financial crisis in 2008.
Major propellers behind the rapid growth are proactive fiscal policy and bank loans that inspire a boom in infrastructure construction all through the country, rising domestic consumption by middle class with more incomes, and a boost in Chinese exports.
However, UBS in its latest forecast said Chinese economy is set to slow down to below 9 per cent this year on concerns of stepped up measures to tackle excessive liquidity and inflation.
GDP growth will fall to 9 per cent from an estimated 10 per cent in 2010, while the inflation, will shoot up to as much as 6 per cent in the first half of the year from the present 5.1 per cent before cooling in the second half and will average 4.3 per cent for the full year, Wang Tao, UBS's China economist yesterday told the official media here.
