Corporate income tax
Wen said Monday that the timing and conditions are now ripe for unifying the enterprise income tax rates for domestic and overseas-funded enterprises to "level the playing field."
The National People's Congress will deliberate the draft law on the equalization of corporate income tax for both domestic and foreign companies.
The unified income tax rate will help foster a fairer, more regulated and transparent taxation system for all kinds of businesses, and help improve the quality and standard of China's utilization of foreign investment, Jiang Enzhu, spokesman for the annual session of National People's Congress (NPC), the national parliament, said Sunday.
"The draft law will neither cause massive influence on foreign companies or affect their enthusiasm of investing in China," Jiang said.
The draft suggests to unify the income tax rates for domestic and foreign companies at 25 percent, according to earlier reports.
The lawmaking process, initiated last December, aims to ease years of criticism that the original dual income-tax structure is unfair to domestic enterprises.
Subsistence allowance system to all rural poor
The Chinese government will expand the subsistence allowance system to all rural poor, said Wen.
The move is expected to bring a poverty-stricken population of 23.7 million under the social security net.
"We will set up a nationwide basic minimum cost of living allowance system this year for rural residents, which has great and far-reaching significance for promoting social fairness and building a harmonious society," Wen told 2,890 NPC deputies assembled at the Great Hall of the People.
NPC deputy Fu Qiping, a village head from Ningbo, Zhejiang Province, said the government's decision to cover all the rural poor under the social security net represents a "big step in poverty alleviation for the vast rural population."
About 23.65 million rural residents living in "abject poverty" in China by the end of 2006 with an annual per capita income less than 683 yuan (87.6 U.S.dollars), according to statistics of the State Council Leading Group of Office of Poverty Alleviation and Development.
Rural medical care
China's rural medical care system will cover more than 80 percent counties, said Wen.
"The trial area of the new type of rural cooperative medical care system will be expanded this year to cover over 80 percent of all counties, county-level cities and city districts in China. Areas possessing the proper conditions may expand the trial faster than others," said Wen.
The allocations from the central government budget to subsidize this trial will amount to 10.1 billion yuan (1.3 billion U.S. dollars) this year, a 5.8 billion yuan (750 million U.S.dollars) year-on-year increase, according to the government work report.
NPC deputy Li Changshui, a village head from Hunan Province, said the move shows the strong commitment and resolution of the central government in improving the lagging-behind rural health service system in the approach to build a new socialist countryside.
Under the new cooperative medical care program launched in 2003, a farmer participant pays 10 yuan (1.3 U.S.dollars) a year, while the state, provincial, municipal and county governments jointly put in another 40 yuan (5.2 U.S.dollars) for the cooperative fund.
The participant can have part of his expense reimbursed in case he is hospitalized. The rate of reimbursement varies according to different kinds of illness and the actual cost of medical expenses incurred.