China’s Ministry of Finance Outlines Proactive Fiscal Policy for 2026

The Ministry of Finance released a report on the implementation of China’s fiscal policy in 2025 on the 17th. Looking ahead to 2026, the report stated that a more proactive fiscal policy will be continued, which is mainly reflected in five aspects, laying a solid foundation for steady economic and social development.

The five key aspects of the proactive fiscal policy include expanding the fiscal expenditure scale to ensure sufficient spending momentum, optimizing the combination of government bond tools to better exert their effectiveness, improving the efficiency of transfer payment funds to enhance local governments’ independent disposable financial resources, continuously optimizing the expenditure structure to strengthen support for key areas, and strengthening fiscal and financial coordination to amplify policy effects and stimulate the vitality of micro entities.

The report also clarified key tasks for 2026 to implement the policy in depth. It emphasized supporting the construction of a strong domestic market by arranging ultra-long-term special government bonds for "two priorities" construction and "two news" work, implementing a package of fiscal and financial policies to boost domestic demand, and launching special campaigns to stimulate consumption, including pilot projects of lottery invoices in some cities.

Efforts will be made to foster new growth drivers by advancing high-quality development actions for key manufacturing industrial chains, organizing the third batch of pilot cities for new technological transformation in manufacturing, and supporting the development of high-tech enterprises, technological small and medium-sized enterprises, and specialized, refined, sophisticated and innovative small and medium-sized enterprises through various policy tools.

To accelerate high-level scientific and technological self-reliance, the report proposed increasing investment in scientific and technological innovation, optimizing the structure of scientific and technological expenditure, and supporting the construction of international scientific and technological innovation centers in Beijing-Tianjin-Hebei, Yangtze River Delta and Guangdong-Hong Kong-Macao Greater Bay Area.

Greater efforts will be made to ensure and improve people’s livelihood, including strengthening employment support, increasing financial input in education and medical and health care, improving basic pension and medical insurance standards, implementing subsidies for the elderly, children and those in need, and supporting disaster prevention and mitigation as well as cultural and sports development.

Other key tasks involve promoting new urbanization and coordinated regional development, advancing comprehensive green transformation through ecological environment management and support for renewable energy, and strengthening scientific fiscal management by adhering to a prudent fiscal approach, deepening fiscal and taxation system reform, and strengthening local government debt management.

The proactive fiscal policy and key tasks for 2026 fully reflect the focus on promoting high-quality development, ensuring people’s well-being and safeguarding national strategic interests, which will effectively support China’s economic and social development to achieve steady progress.