The Chinese government Tuesday issued a five-point preferential policy on agricultural taxes, which is expected to benefit farmers.

Under the new policy, which was published by the State Administration of Taxation, farmers who are engaged in grain planting, animal breeding and fishing are exempted of income tax. They do not pay income tax for the sale of their own products.

Dealers of farm products do not pay income tax, as long as sales do not exceed 5,000 yuan (about US$600), monthly, or 200 yuan (about US$24), daily.

Small venders who move around in countryside and do not own shops are allowed to do business without an official license.

An official of the administration said the favorable policy has been promulgated in response to joint proposals by the Central Committee of the Communist Party of China (CPC) and the State Council.

In recent years, the government has paid greater attention to the issue of farmers who have been suffering from heavy taxes, illegal levies and lower social status. Farmers are regarded as one of the most vulnerable groups in the country.

(Xinhua News Agency January 21, 2004)