(Yicai Global) July 16 -- China's overall tax intake decelerated in the first half of the year, with revenue from personal income taxes falling sharply, in the wake of cuts in taxes and administrative fees.

Total tax revenue rose just 0.9 percent to CNY9.2 trillion (USD1.34 trillion) in the first six months from a year earlier, the finance ministry said at a press conference today, while fiscal revenue, the money collected from various sources to fund the public sector, climbed 3.4 percent to CNY10.8 trillion.

Non-tax revenue surged 21.4 percent to CNY1.6 trillion, mainly from the raising of state-owned funds, said Liu Jinyun, director of the ministry's treasury centralized payment center.

Income from value added tax jumped 5.9 percent, but was 10.7 percentage points slower than in the same period last year. Corporate income tax revenue rose 5.3 percent, down 7.5 points year-on-year, while the personal income tax take plunged 30.6 percent.

Tax revenue in the second quarter dropped significantly from the first quarter, Liu said, adding that it grew 5.4 percent in the first quarter and fell 3.3 percent in the second. VAT revenue fell for two straight months since May and major industries, including manufacturing, benefited greatly.

Local governments issued some CNY2.2 trillion of new bonds in the January-June period to ease the pressure on balance of payments caused by tax cuts, which was 70 percent of the annual credit quota of CNY3 trillion. A total of CNY717 billion of bonds were issued last month, accounting for one-third of first half's total.

Local authorities have accelerated bond issuance this year, extended the maturity period greatly and cut interest rate costs. More than 60 percent of the funds are used for infrastructure investment, which effectively boosts private investment, according to Hao Lei, deputy director of the ministry's budget division.

Editor: Dou Shicong