Fifth Plenary Session Pushing Reform Of Income Distribution

"Establish Expanding consumption demand Long term mechanism and reasonable adjustment of the relationship between income distribution "is clearly written. Bulletin of the Fifth Plenary Session

The 18 communiqu of the Fifth Plenary Session of the Seventeenth Central Committee of the Communist Party of China (CPC) put forward the need to establish a long-term mechanism to expand consumption demand, rationally adjust the income distribution relationship, and strive to increase the proportion of residents' income in the distribution of national income and the proportion of labor remuneration in the initial distribution. Experts pointed out that the reform of the income distribution system should be clearly written into the conference communiqu to highlight the importance of the state. It is expected that the rules for the reform of the income distribution system will be introduced soon, and its main focus will be on the improvement of the income level of low-income groups.

　 Low income groups are the focus.

The plenary proposed that we should rationally adjust the relationship between income distribution, strive to increase the proportion of residents' income in the distribution of national income, the proportion of labor remuneration in the initial distribution, improve the social security system covering urban and rural residents, speed up the reform and development of medical and health services, do well in the work of good people, strengthen and innovate social management, correctly handle contradictions among the people, and effectively maintain social harmony and stability.

"The reform of the income distribution system is clearly written into the Fifth Plenary Session of the communiqu to highlight the country's determination to reform the income distribution. In fact, the details of the reform of the income distribution system may soon come out, and its core content may lie in the improvement of the income of low-income groups." Chen Xinnian, director of circulation and consumption Department of the national development and Reform Commission, said to our reporter.

Chen Xinnian said that raising the income level of low-income groups and expanding the proportion of middle-income groups are also of great significance for promoting consumption. Chen Xinnian believes that to establish a long-term mechanism to expand consumer demand, reforming the income distribution system is a very good aspect. In addition, it may also include many aspects such as raising the level of social security. {page_break}

Emphasizing the first time Distribution proportion adjustment

Sun Qunyi, a researcher at the wage Department of the Ministry of human resources and social security, said that the reform of the income distribution system should be clearly written into the communiqu of the fifth plenary session. It should be said that we have been a result of the continuation of a series of adjustments to the income distribution policy in the past. In 90s, the main goal of adjusting our income distribution is to increase the proportion of fiscal revenue in the distribution of national income and increase the proportion of central revenue to fiscal revenue. After more than ten years' efforts, this goal has been achieved.

Sun Qunyi pointed out that increasing the proportion of residents' income in the distribution of national income and the proportion of labor remuneration in the initial distribution should be clearly included in the communiqu. This means that there will soon be some substantive initiatives, such as the promotion of urban and rural social security coverage in a large area, the promotion of personal income tax and the introduction of real estate taxes, that is to say, capital holding links will be taxed.

　 The strategy of expanding domestic demand is good and the concept of consumption is good.

The communiqu put forward that we should adhere to the strategy of expanding domestic demand, maintain steady and rapid economic development, strengthen and improve macroeconomic regulation and control, set up a long-term mechanism to expand consumer demand, adjust and optimize investment structure, and accelerate the formation of a new situation of consumption, investment and exports to coordinate economic growth.

Wei Fengchun, chief macroeconomic analyst at CITIC Securities, said that the long term mechanism of consumption demand is that consumption and income should be more matched, and that consumption and investment mechanisms should be more matched. Residents' income level should be consistent with the rise of GDP level.

Wei Fengchun said that in the communique, "to adhere to the strategy of expanding domestic demand", what we mean here is not investment demand, but consumption demand. In order to expand consumption demand, we must improve consumption ability. From the aspect of expanding laborers' income, it is mainly to raise basic wages and increase subsidies to low-income people; from the perspective of consumer goods, it is to lower the prices of consumer goods and increase consumption, while the prices of basic consumer goods will not change too much, so in this regard, it is mainly necessary to reduce the real estate prices that everyone is concerned about and expand their consumption.

Therefore, Wei Fengchun pointed out that industries related to consumption will benefit from such industries as health care, education, culture, food, beverages and agricultural products.