Zhu also urged the need to cut down on unnecessary expenses and the duplication of similar projects.

The moves are essential if the central government is to keep below its planned budget deficit this year, which stands at 308.9 billion yuan (US$37 billion), 50 billion yuan (US$6 billion) higher than last year's deficit.

Zhu made the comments at a Beijing-based national conference on increasing revenue and cutting government expenditure.

Levies on value-added tax, consumption tax, business tax, corporate tax and personal income tax are listed by Zhu as the main targets of the belt tightening.

He said strict accounting and invoice management systems are required to be conducted by private companies.

Tax evasion was a serious problem in recent years in some private and foreign-invested companies as well as State-owned enterprises in some key industries.

Facing such a situation, Zhu urged the improvement of the taxation system and the strengthening of the relevant subsidiary systems, such as preferential policies on taxation for imported commodities.

Meanwhile, Zhu said the duplication of similar projects in electrolytic aluminum, alloy iron and glass industries should be put to an end.

He said small-sized coal mines and factories making steel, glass, paper and cement will continue to be closed and readjusted according to law.

It is forbidden to use State funds to build city malls, administrative offices, training centers and interior high-grade entertainment facilities.

Vice-Premier Li Lanqing said the public security, justice, auditing, banking, foreign trade departments and others should cooperate with the finance, taxation and customs authorities to achieve the goal of increasing revenue and reducing administrative costs.

Zhu said despite the slow increase in revenue and fast rise in expenditure this year, China's economy has maintained a sound growth momentum amid a global slowdown.

He said this year's overall economic situation is better than anticipated with remarkable achievements in some fields, establishing the solid economic base.

(China Daily September 17, 2002)