THE State Council, China's Cabinet, yesterday decided to expand its value-added tax reform to more industries and regions to further reduce tax burden on businesses.

From August 1, the reform, replacing a turnover tax with a value-added duty in transport and some service sectors, will spread to the whole country from 12 provinces and municipalities now, according to a statement issued by the Cabinet after an executive meeting chaired by Premier Li Keqiang.

Film, radio and television industries will be included in the pilot reform.

It is estimated that the widening reform will reduce tax burden by 120 billion yuan (US$19.04 billion) this year, the statement said.

The government will extend the reform at a due time to railway transport, postal services and telecommunications industries. It will strive to complete the reform by the end of 2015.

Turnover tax refers to a levy on the gross revenue of a business. VAT refers to a tax levied on the difference between a commodity's price before taxes and its cost of production.

The reform aims to further boost business vitality, help enterprises find new growth, lift employment and residents' income to promote sustainable and healthy development, according to the statement.

The Cabinet also asked government agencies at all levels to tighten their belts and spend prudently to make room for tax reform.

China unveiled the reform in Shanghai last year to avoid double taxation. It was later expanded to another 11 regions, including Beijing, Tianjin and Shenzhen.

By February 1, the program had saved taxes of more than 40 billion yuan for more than 1 million taxpayers, the Ministry of Finance said.