Between 2024 and 2026, China's tax expenditure on residential fossil fuels is forecasted to remain stable at 0.007% of GDP. An increase is projected in 2027 and 2028 to 0.008% of GDP, indicating a modest year-on-year rise from 2026 to 2027 and continuing into 2028. Over a five-year period from 2024 to 2028, the compound annual growth rate (CAGR) reflects minor upward trends in expenditure allocation as a percentage of GDP.
Future trends to watch for include:
- Government policy shifts towards reducing fossil fuel reliance and increasing renewable energy support.
- Impact of economic growth and energy demand on tax expenditure adjustments.
- The potential influence of international climate agreements on China's tax policy towards fossil fuels.
