Asian Development Bank

Reforming the Financing System for the Road Sector in the People's Republic of China Asian Development Bank

The People's Republic of China implemented the Fuel Tax Reform in 2009. It abolished a range of provincial and local government fees and increased the central government tax on motor vehicle fuel. This reformcentralized the government revenues for the sector, but various issues remain. This publication analyzes the implications of the reform on the operation and maintenance of ordinary roads. It recommends the formation of a National Road and Funding Administration, responsible for the national road programs and policy, and the creation of a central road trust fund to finance the operation and maintenance of ordinary roads.