According to sources cited by Bloomberg, China's Ministry of...

According to sources cited by Bloomberg, China's Ministry of Finance is set to introduce the largest economic stimulus policy in history, marking another significant adjustment in fiscal policy following actions by the central bank.

Informed sources indicate that China is considering a large-scale fiscal stimulus of unprecedented scale, referred to as the "three arrows" of the strongest measures in history.

(1) Increase public budget expenditures, with an expected addition of 1.3 trillion yuan in special bonds by the end of the year, and 500 billion yuan in new long-term special government bonds. On top of the existing 10 trillion yuan in central government transfers to local governments, an additional 5 trillion yuan will be transferred ahead of schedule by the end of the year. Long-term government bonds will be issued at a rate of 100 billion to 500 billion yuan per month, with a maximum annual cap of 6 trillion yuan.

(2) Increase living assistance, with nearly 2 trillion yuan already distributed this year, and an additional 1 trillion yuan in emergency assistance by year-end. Subsidies for rural construction will exceed 4.5 trillion yuan this year, with an additional 1.8 trillion yuan in emergency assistance by the end of the year. For the market's concern regarding assistance for the "poor," efforts will be made to achieve substantive results by year-end, with the assistance amounting to no less than the local minimum wage standard.

(3) Complete the increase of local tax authority before the end of the year, along with large-scale tax reductions. Urban construction, education surcharges, and local education taxes will be fully transferred to local governments. The personal income tax threshold will be raised to 8,000 yuan, and the corporate income tax for eligible enterprises will be reduced from 25% to 20%. For qualifying small and medium-sized enterprises, the tax rate will be adjusted to 0.5% (down from 5%), with a focus on optimizing tax categories next year.