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The government received 17.95 billion yuan (US$2.24 billion US dollars) in securities stamp duty last year, up 166 percent over 2005, according to the State Administration of Taxation (SAT).

Spurred by heavy capital inflow, revenue soared despite the tax rate cut, Xie Xuren, director of SAT said on Wednesday.

The government required both buyers and sellers of stocks to pay stamp tax according to the transaction volume.

The government halved the stamp duty rate to 0.1 percent from January 24, 2005 in a bid to help boost the depressed equity market.

China's stock markets ended a five-year bearish period last year. The benchmark Shanghai Composite Index surged 130 percent to 2,675 points at the end of 2006. The two mainland stock exchanges registered aggregate turnover of 9.05 trillion yuan in 2006, an increase of 186.22 percent on 2005.