[Photo: baidu]

China is set to replace turnover tax with value-added tax in medical-care and old-age care fields in a bid to boost consumption.

VAT is tax levied on the difference between the cost of production and the price of a commodity on the market.

It is favored partly because it can reduce double taxation.

The move aims to further simplify policies on pre-tax deduction of enterprise income tax in order to ease corporate tax burden.

The timetable for implementation has not been announced at this point.

The government document also pledges to improve consumer subsidy policies via promoting a shift in subsidizing sellers to subsidizing consumers.

All of these measures conform to its principle of cranking up fiscal supports for new consumption-related areas.

For more on this, we are joined by Gao Shang, commodity analyst with Guantong Futures.