We will establish a fiscal relationship between the central and local governments that features well-defined powers and responsibilities and the appropriate allocation of resources, with an optimum balance between regions. To place more fiscal resources at the disposal of local governments, we will expand the sources of tax revenue at the local level and grant greater authority for tax management to local governments as appropriate. To improve the system of transfer payments, we will overhaul special transfer payments and increase the scale of general transfer payments. These will help ensure that the fiscal resources of prefecture- and county-level governments are commensurate with their powers. We will establish incentive and constraint mechanisms through transfer payments to promote high-quality development. We will take steps to move excise tax collection further down the production-to-consumption chain, with the power of collection steadily being passed to local governments. We will improve the value-added tax credit refund policy and free up the channels for making tax deductions. The ratio for taxes shared between the central and local governments will be optimized. We will look into rolling the urban maintenance and construction tax, education surcharges, and local education surcharges into one single local surtax. Local governments will have the authority to set the rate for this tax within a predetermined range. We will appropriately expand the scope of use for funds raised from the sale of local government special-purpose bonds, permitting a greater share of such funds to be used as capital in more sectors and on a larger scale. The systems for managing government debt will be improved. We will establish a system for monitoring and regulating all local government debt as well as long-term mechanisms for preventing and defusing hidden debt risks. We will move faster to reform and transform local government financing platforms. In regulating the management of non-tax revenue, we will delegate, as appropriate, some management authority to local governments and allow them to tailor their practices to local conditions.