BEIJING — A State Council executive meeting chaired by Premier Li Keqiang on Aug 18 specified measures to lower financing costs for businesses and consumption credit costs for individuals, so as to step up financial support for the real economy.

The meeting also decided to increase assistance for those in difficulty, help elderly care and childcare industries navigate hardships, and continue the vehicle purchase tax exemption for new energy vehicles (NEVs).

China's economy has sustained its recovery momentum, but there remain slight fluctuations, the meeting noted, stressing the importance of stepping up targeted fiscal and monetary policies to support the real economy.

In this regard, the meeting underlined the need to efficiently use the local special bond issuance quotas in accordance with the law, and give play to the guiding functions of the loan prime rate.

The meeting pointed out that the number of people in distress has increased due to COVID-19 and natural disasters. In the first half of the year, China allocated more than 120 billion yuan ($17.63 billion) of fiscal funds to the provision of subsistence allowances and other subsidies, up 7 percent year-on-year.

The country will further enhance support to ensure the basic living needs of people in difficulty, the meeting said. The subsistence allowance program will be expanded and support for people in need will be strengthened.

The meeting stressed that from September 2022 to March 2023, the mechanism of raising social benefits pro rata to price increases will be adjusted. On top of the existing seven groups, including people living on subsistence allowance and orphans, the mechanism will be extended to cover those receiving unemployment subsidy and those nearing the eligibility threshold of subsistence allowance. The expanded policy measures will cover 67 million people in total.

China will provide funding subsidies for localities based on their increased expenditures from the expansion of the relief scheme and the adjustment of the price subsidy mechanism, the meeting said.

Noting that the elderly care and childcare services industries are closely related to people's well-being and have been hit hard by COVID-19, the meeting highlighted a raft of measures for the two sectors, including rent exemptions for self-employed individuals and micro, small and medium-sized businesses renting State-owned properties.

To spur NEV consumption and green development, the meeting said that the vehicle purchase tax exemption for NEVs, which has already been extended twice and is due to conclude at the end of this year, will be extended to the end of 2023. The latest extension is expected to waive 100 billion yuan of taxes, the meeting said.