State-owned assets 'need to be further capitalized' (3)

According to Sheng, the tax rate for SOEs stands at 10 percent, while private companies get a tax rate of 24 percent.

At the end of 2011, China had 117 central SOEs that held assets worth 28 trillion yuan, mainly operating in the energy, telecommunications, transportation and defense industries.

China's SOEs have long been blamed for dominating the market, and calls for reforms to break their monopolies intensified after the government introduced its 4 trillion yuan stimulus package in 2008, which consolidated the market position of SOEs.

Wang Yong, head of the State-owned Assets Supervision and Administration Commission, said earlier that SOEs must be more market-oriented as a major part of the overall reform.

The country should redefine the roles of SOEs and break up monopolies in certain industries, diversify ownership, and lower entry barriers to private firms, said the World Bank in a joint report with the Development Research Center of the State Council, which was published in February.

Contact the writer at wangxiaotian@chinadaily.com.cn

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