China plans to cut the value-added tax (VAT) rate that covers the manufacturing sector by 3 percentage points.
Premier Li Keqiang is due to deliver his work report at the annual meeting of parliament starting on Tuesday. In the report, the government will outline its targets for the economy, as well as its policy direction.
China has said it will pursue a more proactive fiscal policy this year as the world's second-largest economy further slows. Policy insiders previously said they expect the government to cut the VAT, which ranges from 6 percent for the services sector to 16 percent for manufacturers.
Finance Minister Liu Kun said in January that tax cuts for small and private firms would lower their costs by 200 billion yuan a year.