Basis for Government Pricing Acts

(I) Pricing catalog
A pricing catalog is a written document that defines and divides pricing powers, and contains product varieties and service items, pricing content, pricing authority, pricing form and scope, etc. Pricing catalogs are classified as central and local pricing catalogs.
(II) Basis for formulating government pricing and government referential pricing
(1) Social average costs of goods or services.
Costs can be divided into individual costs and social average costs. An individual cost is the cost of producing and operating a product or providing services incurred by a business operator, and is the basis for their independent pricing. The average social cost is the average cost of producing and operating a product or providing services incurred by different business operators, and reflects the necessary labor cost under normal operation and management conditions. Government pricing may only be based on the average social cost.
(2) Market supply and demand.
On the basis of fixed costs, market supply and demand are the decisive factors that affect the fluctuation of prices around value. Government pricing acts should also reflect the conditions of market supply and demand and regulate supply relations.
(3) The demand of national economy and social development.
Government pricing acts are a macroeconomic regulation tool, and the needs of economic and social development should also be considered when setting prices.
(4) Social acceptability.
From the perspective of the whole society, there is a problem of price acceptability. And acceptability of prices are different in different regions and between urban and rural areas, which are all factors that the government should consider in its pricing acts.
(5) In addition, a reasonable price difference is also required. There are four price differences.
① Difference between purchase and selling prices: The difference between the purchase price and selling price of the same product from the same origin at the same time.
② Difference between wholesale and retail prices: The difference between the wholesale price and retail price of the same product in the same market at the same time.
③ Regional price difference: The difference between the prices of the same product in different regions at the same time.
④ Seasonal price difference: The difference between the prices of the same product in the same market in different seasons.