China’s Public Spending Rises 1% to 21.0199 Trillion Yuan in 9 Months

Key Facts

China’s general public budget spending rose 1% year on year to 21.0199 trillion yuan in the first three quarters of 2026, according to Finance Ministry data published on Oct. 23. The total reflected a divergence between central and local spending, with the former growing much faster than the latter. Over the same period, tax revenue increased 6.1%, while non-tax revenue rose 1.2%. The figures show a contrast between specified growth in tax revenue and the limited increase in public spending. Spending from government-managed funds budgets also fell sharply, including outlays linked to land-sale proceeds.

Central government spending reached 3.282 trillion yuan, up 5.8% from the same period a year earlier, while local government budget spending came to 17.7379 trillion yuan, up just 0.2%, according to the Finance Ministry. The gap highlights that the overall spending increase was not shared at the same pace across the two levels of government. On the revenue side, tax receipts totaled 14.0706 trillion yuan, compared with 3.1586 trillion yuan in non-tax revenue. Tax revenue growth rose 6.1% year on year, compared with a 1.2% increase in non-tax revenue. A ministry official said continued economic growth, higher prices, activity in the stock market and strong foreign trade supported growth in fiscal revenue.

Within tax receipts, domestic value-added tax revenue increased 6%, while corporate income tax rose 7.1% in the first nine months. The ministry attributed the growth in value-added tax to continued expansion in industry and services and higher industrial producer prices. It linked the increase in corporate income tax to growth in corporate profits. These details point to different sources of tax revenue growth, combining industrial and services activity with corporate profits. The ministry listed these factors alongside higher prices, stock market activity and strong foreign trade as supporting revenue.

On the spending side, health expenditure rose 7.7%, with the Finance Ministry saying the increase was mainly due to the disbursement of more childcare subsidies. Spending on social security and employment also increased 5.2% over the same period. The breakdown shows growth in health and social protection outlays alongside limited growth in overall public spending. The figures in the statement do not specify the yuan value of each item, but give annual rates of change and one reason for the increase in health spending. The ministry directly linked the rise in health expenditure to expanded disbursement of childcare subsidies.

Alongside the general public budget, spending from government-managed funds budgets fell 16.2% to 6.2754 trillion yuan in the first nine months. Local government funds budget spending declined 11.6%, while spending linked to proceeds from sales of state-owned land-use rights fell 18.5%, according to official data. These declines place local funds financing linked to land among the weakest spending items in the published figures. They came as local spending under the general public budget grew only modestly. The funds budget item is separate from the general public budget total, showing a parallel fiscal trend that is not included in the 21.0199 trillion yuan public spending figure.

The fiscal data come as gross domestic product grew 4.6% in the first three quarters, including 4.5% growth in the third quarter, according to the National Bureau of Statistics. Industrial value added rose 5.5% in September, up 0.3 percentage points from the previous month, and increased 5.3% year to date. By contrast, retail sales grew 1.1% in the first nine months and posted the same rate in September. Retail sales totaled 37,000.1 billion yuan from January to September, according to the bureau. The indicators show a divergence between industrial growth and consumption alongside the government spending and revenue figures.

In the latest activity data cited in the sources, the official manufacturing purchasing managers’ index stood at 50.1% in September, up 0.3 percentage points from August and moving into expansion territory, according to the National Bureau of Statistics. This is the actual September reading and is not a forecast for October. A Finance Ministry official also said lending support measures, consumer spending and private investment helped support new loans exceeding 28 trillion yuan, up 3.1% year on year. He said the facilities benefited 8.36 million companies and recorded 147 million instances of use by residents during the period. The ministry presented these figures in the context of measures supporting financing, spending and private investment.