China announced on Sunday it would spread a reform of its value-added tax regime to all industries nationwide, which could cut the tax burden on enterprises by 120 billion yuan (about US$17.6 billion).

The reform would help encourage technological upgrading at Chinese companies, said an executive meeting of the State Council, which also put forward a stimulus package of 4 trillion yuan to be spent by the end of 2010 to expand domestic demand.

The reform was aimed at a shift from the existing production-based value-added tax regime to a consumption-based one, which enables Chinese companies to get tax deductions on spending on fixed assets.

(Xinhua News Agency November 10, 2008)