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Haitong Macro Liang Zhonghua team
Authors of this report:
侯 欢 S0850522080004
梁中华 S0850520120001
· Overview ·
Non-tax revenue still has a relatively high growth rate. In the first four months of 2024, the country's general public budget revenue fell by 2.7% year-on-year, and the budget progress for the whole year was roughly the same as the average for the same period in the past three years. Among them, the monthly growth rate in April was -3.7%, which was lower than that in March. However, after deducting the impact of special factors, in the first four months of 2024, the general public budget revenue increased by about 2% year-on-year. Fiscal revenue in the narrow sense reflects that the economy is in a weak recovery channel. It is worth noting that in the case of sluggish growth of tax revenue, non-tax revenue complements financial resources, and may continue to be at a good level in the future. The growth rate of fiscal expenditure in the narrow sense has rebounded and the progress has accelerated. In the first four months of 2024, the country's general public budget expenditure increased by 3.5% year-on-year. Among them, the monthly growth rate in April was 6.1%, which rebounded from March. In our view, the main reason may be that the start margin of additional treasury bond issuance projects accelerated in the fourth quarter of last year. From the perspective of sub-items, the tendency of narrow fiscal expenditure in the field of infrastructure has increased. In May, the National Development and Reform Commission (NDRC) said that the remaining projects of the additional treasury bonds would be fully started by the end of June. Considering that ultra-long-term special treasury bonds have also been issued since May, the growth rate of infrastructure spending may rebound marginally, and the overall expenditure growth rate will further improve. In April, the decline in government fund revenue and expenditure expanded, and the progress was relatively slow. On the income side, the current pressure on real estate supply and demand still exists, and the income from land sales is the main drag. In May, the decision-makers proposed to support the government's acquisition of the stock of commercial housing and the idle stock of residential land that has been transferred, and we believe that the financial support for the purchase and storage needs to be continuously tracked. On the expenditure side, the widening of the decline may be related to the slow pace of issuance of new special bonds since the beginning of this year. At the Politburo meeting in April, it was proposed to "speed up the issuance and use of special bonds", and the scale of new special bonds has increased marginally since May, and the decline in government fund expenditure may be narrowed. We believe that in the second quarter, we will mainly focus on the early implementation of the macro policies that have been determined. Next, in the case of the acceleration of the issuance of additional treasury bonds and special bonds, the intensity of fiscal expenditure may be marginally increased.
Risk warning: the policy is less than expected.
1
Non-tax revenue: The growth rate is still relatively high, and after deducting special factors, the growth rate of fiscal revenue has rebounded. In the first four months of 2024, the national general public budget revenue was 8,092.6 billion yuan, down 2.7% year-on-year, and the budget progress for the whole year was about 37.2%, which was roughly the same as the average level of the same period in the past three years. Among them, in April, the growth rate of general public budget revenue was -3.7% in the month, which was lower than the growth rate of -2.4% in March. However, what is more noteworthy is that in the first four months of 2024, the general public budget revenue increased by about 2% year-on-year after deducting the impact of special factors such as the tax deferrals and storage of small, medium and micro enterprises in the same period last year, and the tax reduction policy introduced in the middle of last year. Among them, the year-on-year growth rate in April was 1.4%, a marginal rebound compared with March.
The growth rate of non-tax revenue is still relatively high. In the first four months of 2024, the national tax revenue was 6,693.8 billion yuan, a year-on-year decrease of 4.9%, of which the growth rate in April was -4.9%, which was narrower than the growth rate of -7.7% in March. It is worth noting that in the first four months of 2024, non-tax revenue was 1,398.8 billion yuan, a year-on-year increase of 9.4%. Among them, the monthly growth rate in April was 5.8%, which was lower than that in March, but still maintained a high growth rate. This also means that in the case of sluggish growth of tax revenue, non-tax revenue complements fiscal resources, and may continue to be at a good level in the future. In terms of the monthly growth rate of different types of taxes, the growth rate of personal income tax and enterprise income tax revenue fell in April. The growth rate of consumption tax revenue turned from negative to positive, and the decline rate of value-added tax revenue narrowed. Considering the disturbance of special factors, the changes in the growth rate of subdivided tax revenue should not be over-interpreted.
2
Narrow spending: the growth rate has picked up, and the progress has accelerated, and the growth rate of expenditure has rebounded marginally. In the first four months of 2024, the national general public budget expenditure was 8,948.3 billion yuan, a year-on-year increase of 3.5%. Among them, the monthly growth rate in April was 6.1%, which rebounded from the growth rate of -2.9% in March. In addition, in the first four months of this year, the national general public budget expenditure completed 32.5% of the budget, higher than the level of the same period in the past three years. In our view, the main reason may be that the start margin of additional treasury bond issuance projects accelerated in the fourth quarter of last year.
From the perspective of the monthly growth rate of sub-expenditures, the growth rate of expenditures on science and technology, energy conservation and environmental protection, agriculture, forestry and water resources was relatively high in April, and the growth rate of expenditures on urban and rural communities and transportation rebounded rapidly, reflecting the tendency of narrow fiscal expenditure in the field of infrastructure to increase. In May, the National Development and Reform Commission said that 11,000 of the 15,000 projects that have been implemented for the additional issuance of treasury bonds have started construction, with a start-up rate of 72%, and the remaining projects will strive to start construction by the end of June. In addition, considering that ultra-long-term special treasury bonds have also been issued since May, the growth rate of infrastructure expenditure may rebound marginally, and the overall expenditure growth rate will further improve.
3
Government fund revenue and expenditure: The growth rate has declined marginally, and the decline in government fund income has expanded, and the progress is relatively slow. In the first four months of 2024, the budget revenue of national government funds was 1,348.4 billion yuan, a year-on-year decrease of 7.7%. Among them, the growth rate in April was -18.2%, compared with -15.9% in March. In addition, in the first four months, the budget revenue of government funds was 17.2% in the budget for the whole year, which was lower than the level of the same period in the past two years. The reason for this is that the current pressure on real estate supply and demand still exists. The year-on-year growth rate of land transfer income in April was -21.2%, which was marginally lower than the growth rate in March. Digesting the stock of real estate, the government needs to order it is worth paying attention to. In May, the policy side further stabilized the real estate market by reducing the down payment ratio of housing loans, canceling the lower limit of interest rates, and lowering the interest rate of provident fund loans. It is worth noting that the decision-making level proposed that local governments "properly dispose of the idle stock of residential land that has been transferred by means of repossession and acquisition as appropriate", and that "the city government with a large inventory of commercial housing can purchase some commercial housing at a reasonable price as appropriate". From the perspective of funding sources, on the one hand, an additional 500 billion yuan PSL quota will be added to support the construction of "three major projects" such as affordable housing. On the other hand, the establishment of 300 billion yuan of affordable housing re-loans to support local state-owned enterprises to acquire stock housing is expected to drive 500 billion yuan of bank loans. It is not difficult to find that monetary policy has given more support in stabilizing real estate, but we believe that fiscal strength is the key. At present, for the acquisition of part of the stock housing and the idle stock land that has been transferred, the financial department will provide financial support for local special bonds and tax incentives for affordable housing, and it is required not to increase the risk of hidden government debt. We believe that the intensity of fiscal spending on storage needs to be continuously tracked. The decline in government fund expenditure has expanded, and the progress needs to be accelerated. In the first four months of 2024, the national government fund budget expenditure was 2,219.8 billion yuan, a year-on-year decrease of 20.5%. Among them, the growth rate in April was -35.9%, compared with -23.3% in March. It is worth noting that in the first four months, the budget expenditure of government funds in the whole year was 18.8%, which was significantly lower than the level of the same period in the past two years. In our view, this may be related to the slow pace of issuance of new special bonds so far this year. At the Politburo meeting in April, it was proposed to "speed up the issuance and use of special bonds", and the scale of new special bonds has increased marginally since May, and the decline in government fund expenditure may be narrowed.
Risk warning: the policy is less than expected.
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