Chinese bureaucrats who overspend on vehicles, public receptions and overseas trips or buy luxury items above a certain standard could be fired, the government has warned.
The new rules also define a "frugal working style" for civil servants. The announcement comes as the world's second largest economy faces the prospect of a slowdown amid falling demand for Chinese exports.
The Indian government in May had announced somewhat similar measures like a ban on the purchase of vehicles by the government, curbs on conducting seminars in five star hotels with state funds and restrictions on foreign trips by officials.
The rules published Monday by the State Council follows the eastern China city of Wenzhou banning luxury food like shark fins, abalones (sea food) and wild ginsengs from official banquets. Also banned were expensive local liquor like Kweichow Moutai and high-end cigarettes.
Wenzhou authorities also placed a cap on the number of officials attending banquets. The expenses incurred on such occasions were not to exceed 60 yuan ($9.4) for each person, the local government said.The central government's regulations are the first of this kind to be imposed on authorities above county level. The rules will take effect from October 1.
According to the new regulation, anyone who overspends on the items or misappropriates funds from other budget items to cover them will be demoted or even removed.
According to Xinhua, the same punishment will be applied to other instances of misconduct, such as retaining more official vehicles than the allowed quota, spending more than allowed on cars and interior decoration, and building luxurious office facilities.
Finance ministry data showed that in 2011, the administrative expenditures of agencies within the central government amounted to 90 billion yuan ($14 billion), of which over 10% was spent on the three items.
"If public spending on these three heads can be controlled, it could be a turning point in the building of a clean government in China," Hu Xijin, editor of the Global Times, a nationalist-leaning tabloid, said.