BEIJING — China has witnessed a spike in the number of new taxpaying market entities in the first five months as the country's economy continues to recover from the COVID-19 pandemic.

A total of 5.22 million new market entities handling tax-related business were registered during the January-May period, an increase of 40.19 percent from the same period last year, data by the State Taxation Administration showed.

Newly registered companies numbered 2.78 million, representing a rise of 37.14 percent year-on-year. The number of new individual businesses stood at 2.37 million in the reporting period, up 45.37 percent from a year ago.

Up to 98.86 percent of the new market entities handling tax-related business in the five-month period were privately owned, up 0.09 percentage points and 0.53 percentage points from the same period in 2020 and 2019, respectively, according to the administration.

Market entities from the wholesale and retail sectors, commercial service and construction sectors accounted for 56.05 percent of the total, while the proportion of new taxpayers from the modern service sector witnessed continued growth, the administration said.