CCP to Impose New Local Taxes to Alleviate State’s Financial Difficulties

Experts say it will harm the overall Chinese economy and force people to rebel.

The 20th Central Committee of the CCP is about to hold its third plenary session in Beijing, where the authorities are planning "fiscal and tax reforms." The image shows the headquarter of the People's Bank of China, the central bank, in Beijing, China, on Dec. 13, 2021. Andrea Verdelli/Bloomberg via Getty Images

The Chinese Communist Party (CCP) is planning to impose a new local surcharge tax with a theoretical revenue scale of nearly $1 trillion yuan ($138 billion) per year to keep local governments afloat, after a top meeting earlier this month, according to Chinese media reports.

The official “decision” passed at the CCP’s Third Plenum in mid-July stipulates that in order to solve the financial difficulties of local governments, “it’s necessary to increase local independent financial resources, expand local tax sources, and appropriately expand local tax management authority.”