China’s Budget Deficit Widens 600% as Pandemic Cuts Revenue

China’s finances have been squeezed this year as the worst Covid wave in more than two years and restrictions imposed to contain the outbreaks curbed economic growth and tax income

(Bloomberg) — China’s broad budget deficit in the first six months of the year widened to a record as government spending climbed and falling land sales and tax breaks reduced income.

The budget deficits for all levels of government totaled a combined 5.1 trillion yuan ($758 billion), according to Bloomberg calculations based on data released Thursday by the Ministry of Finance. That was the highest ever for the first half of any year and compares with a shortfall of just 718 billion yuan at the same point in 2021 and a gap of 3.4 trillion yuan in 2020.