In recent years, through the implementation of large-scale tax and fee reductions, the role of reducing the burden on enterprises and enhancing development momentum has been effectively played. At the same time, with the implementation of tax and fee reductions, how to maintain a certain level of support, give full play to the effectiveness of the rescue, and comprehensively consider the impact on fiscal revenue to ensure sustainable financial operation has attracted social attention. According to the deployment of the executive meeting of the State Council, this year, we will continue and optimize the implementation of some phased tax and fee preferential policies. Recently, the Ministry of Finance and the State Administration of Taxation have issued a series of announcements to clarify specific policies and measures such as income tax and R&D expenses deduction for small and micro enterprises and individual businesses. Compared with recent policies, the accuracy and pertinence of implementing tax and fee reductions this year are more prominent. Statistics show that the proportion of tax revenue to GDP in China has decreased from 17% in 2018 to 13.8% in 2022. The significant decrease in macro tax burden is a direct reflection of the effect of implementing tax reduction policies. At the same time, influenced by factors such as the impact of the epidemic, downward pressure on the economy, and tax and fee reductions, China's fiscal revenue and expenditure are in a tight balance. Only by maintaining a certain amount of financial resources can economic development and improvement of people's livelihood be strongly guaranteed. In the process of implementing tax and fee reductions, if you blindly emphasize the scale of burden reduction, it is easy to overdraw financial resources and exacerbate the contradiction between revenue and expenditure. Therefore, it is necessary to continuously improve and optimize the tax and fee support policy, continuously enhance its accuracy and pertinence, and maximize the effectiveness of the policy. To implement preferential tax policies, dividends should be concentrated on the business entities most in need of relief. Small and micro enterprises and self-employed businesses are large and widespread, and they are the new force for development and the main channel for employment. At the same time, they are the groups that are most affected by various adverse factors and face the most difficulties. To achieve stable growth and employment, small and micro enterprises and individual businesses must be given priority and support. This year's preferential tax policies still highlight support for small and micro enterprises and individual businesses, and optimize and improve policies on income tax and value-added tax for small and micro enterprises and individual businesses. Focusing the available policy space on small and micro enterprises and individual businesses can play a role in seizing the "bull nose", and the effect of promoting growth and employment will definitely be more obvious. To improve the accuracy of tax and fee reductions, it is also necessary to focus policy efforts on key links. Scientific and technological innovation is an important source of power driving high-quality development, and for enterprises, it is the source of their core competitiveness. This year, China will increase the pre tax deduction ratio of R&D expenses for eligible industry enterprises from 75% to 100% as a long-term institutional arrangement. The increase in the pre tax deduction of enterprise research and development expenses means that the amount of tax payable by enterprises is correspondingly reduced, which is actually the "real gold and silver" support provided by the state for enterprise research and development. Previously, only manufacturing enterprises and technology-based small and medium-sized enterprises implemented a 100% deduction ratio for R&D expenses, and this was a phased policy. The new policy has two major breakthroughs. One is to make other eligible industry enterprises consistent with the R&D expense deduction policy for manufacturing and high-tech SMEs. The other is that this policy will no longer set a deadline, but will be implemented as a long-term institutional arrangement. "Enlargement+institutionalization" effectively stabilizes market expectations, allowing enterprises to focus more on the long-term and increase investment in research and development