The government's revenue fell 11.4 percent from a year earlier in the first two months, as the economic downturn hurt corporate profits and recent tax cuts took effect.

Revenue fell to 1.02 trillion yuan in January and February, 131.56 billion yuan less than the same period a year ago, the Ministry of Finance said on its website.

The ministry also said the fiscal revenue declined much faster in February than in January. It said the decline was largely due to the economic crisis that affected corporate profits. Apart from this, the government's recent move to reduce taxes has also dented the State coffers.

Over the past year, the government raised the level of tax rebates to bolster exports, reduced taxes on house purchases to support the real estate market, and cut interest on savings and stamp duty of stock trading to boost the financial market.

Premier Wen Jiabao said in the government work report that the government would hand out 600 billion yuan for local enterprises and residents in the form of tax cuts to help boost domestic demand.

The government expects revenue to grow 8 percent in 2009, much slower than previous years. Its revenue climbed 18.8 percent in 2008 and 32.4 percent in 2007.

Policymakers have planned a budget deficit of 950 billion yuan for 2009, a record high in six decades, as it ratchets up spending to cushion the impact of the global financial crisis.

Still, Premier Wen said the deficit level poses no threat to the overall economic stability, as it is well below 3 percent of the nation's GDP. Meanwhile, the government's total debt is less than 20 percent of its GDP, much lower than most of the other nations.

"The major concern is how to maintain the steam in the economy," Wang Dacheng, deputy director of the National People's Congress Standing Committee's budgetary affairs commission, said. "Once the economy recovers, the government revenue growth could be back on the fast track."