BEIJING, Aug. 29 -- China will further improve its financial transfer payment system, according to a report from the State Council.

The report on the country's transfer payment system was submitted to the fifth session of the Standing Committee of the 14th National People's Congress, China's top legislature, for deliberation on Monday.

China will work to improve the legal system for financial transfer payments, establish and improve the classified management mechanism for transfer payments, improve the budgeting of transfer payments, strengthen the allocation and use of transfer payments and the performance management of transfer payments, and further deepen the reform of the transfer payment system below the provincial level, according to the report.

"Improving the financial transfer payment system is a part of deepening the reform of the country's fiscal and taxation systems, and an important guarantee for the implementation of the major policies of the country," said Finance Minister Liu Kun.

The financial transfer payment refers to the funds allocated by higher-level governments to lower-level governments free of charge. It is an important policy tool mainly used to solve the problem of regional financial imbalance and promote the equalization of basic public services between regions.