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Trade war

China doubles down on tax cuts in race to halt economy's slide

Beijing readies big package for 2019 on top of last year's near-$200bn relief

A view of the Shanghai skyline. China is turning to tax cuts to simulate the economy in a shift away from public works projects.   © Reuters

BEIJING -- China is sticking with a large-scale tax cut strategy deployed last year to keep the economy humming, adding to the 1.3 trillion yuan ($192 billion) of relief already in place with further cuts to income taxes and social security premiums.

Speaking with business leaders this week, Premier Li Keqiang said growth must remain within a reasonable range, with no sharp drop-off. The tax reduction program for 2019, set to be announced in March, is projected to top 1.5 trillion yuan. The People's Bank of China also lowered the reserve requirement for commercial banks this month, following up on a few reductions last year.

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