China plans to expand public expenditure budget by 8.4 percent in 2022 compared with last year, totaling 26.71 trillion yuan ($4.23 trillion), according to a draft 2022 budget report released on Saturday. 

The country is set to implement a proactive fiscal policy that emphasizes precision and sustainability in enhancing its effectiveness, the report said. 

The budget plan was announced against the backdrop of major domestic headwinds including shrinking demand, supply shocks and weakening expectations, while the COVID-19 pandemic and high commodity prices have added to the pressure. 

To support regional economies, the transfer payment from the central to local governments will jump 18 percent, reaching almost 9.8 trillion yuan. 

Spur market vitality 

China plans to take multiple measures to ease the burden on market entities. Tax rebates and cuts are estimated to total 2.5 trillion yuan for 2022, including 1.5 trillion yuan in value-added tax refunds going straight to enterprises. 

The country has also lowered the deficit-to-GDP ratio for the year to around 2.8 percent. 

An additional 3.65 trillion yuan in local government special-purpose bonds will be released in 2022, the same amount as last year. 

China plans to allocate 61.75 billion yuan in employment subsidies, an increase of 5.16 billion yuan in supporting the job market and entrepreneurship. 

In an effort to advance rural revitalization, China plans to allocate 41.63 billion yuan in subsidies for agricultural insurance premiums, an increase of 30.8 percent.

The draft budget report was submitted to the fifth session of the 13th National People's Congress for deliberation.