BEIJING (REUTERS) - China has formulated a gameplan for a long-delayed overhaul of income distribution, that reformers hope will unlock revenues and help address China's growing inequality, but left details vague in an announcement on Tuesday.

The plan called for raising low incomes and "adjusting overly high income," as well as corporate and structural reforms, the Xinhua news agency said.

Jointly backed by the National Development and Reform Commission, the Ministry of Finance and Ministry of Human Resources and Social Security, the plan was approved by the State Council, or cabinet, it said.

In approving the plan, the State Council noted that income distribution reform is fundamental to long-term economic development.

"Some obvious problems of income distribution require quick resolution," the State Council said, according to Xinhua.

"The urban-rural gap and the difference in citizens' income is relatively large, income is irregularly distributed, there are obvious problems of grey income and illegal income, and some of the masses live in difficult conditions."

The plan calls for "improved initial income distribution", followed by an accelerated "secondary distribution adjustment mechanism," Xinhua said without elaborating.

Finally, it called for "building a long-term mechanism" to boost rural incomes.

The report did not provide details.

Trimming the power enjoyed by state-owned firms was top on the list of structural reforms submitted by think-tanks ahead of the November hand-over of leadership in the ruling Communist Party.

State-owned firms generally revert only a small portion of their profits to the state, but have come under increasing pressure from reformists who believe they benefit from too much support which the private sector does not share.

These profits are seen as a potential source of funding as China builds pension, health insurance and other systems to create a social safety net for its citizens.

Decades of economic reform have made some very rich and brought prosperity to an urban middle class. But many, particularly in the countryside, have been left behind.

The National Bureau of Statistics this month released an updated estimate that the country's Gini coefficient, a measure of income disparity, had reached 0.474 - well above the 0.40 level considered a trigger for social discontent.