破産寸前の地方政府、企業への容赦ない徴収が暴走

As China's economic downturn continues, the government is also struggling to secure its resources. Recently, it has become clear that the local government in China is selling off its assets and monetizing them. However, the financial situation has not improved at all, so it is now trying to squeeze funds from private companies. According to the official statistics released by the Chinese authorities, the government's revenue other than tax revenue in the first half of this year has exceeded one year's revenue in 2014, 10 years ago. Economists, who have seen the irrational behavior of the Chinese authorities, believe that this is a very worrisome phenomenon and point out that it is an act to kill chickens to lay eggs. According to a report by the Hong Kong media South China Morning Post, the local government in China is using all means to squeeze funds from private companies, not only for the ZHAGOMAITIE project and special reconstruction. ZHAGOMAITIE means to break the pot and sell it as scrap iron, and it means to sell off the government's assets and imprison them. At the end of August this year, a recording posted on Chinese social media exposed the unknown side of the local government's financial crisis. In the recording, the market director of Shantou Small and Medium Enterprises spoke in a tone that could be said to threaten the representative of the medical technology company. In order to compensate for the lack of government budget, it is to extort a certain amount of funds from private companies every year. To be honest, it is very difficult to support the company and develop it, said the market director. But it is very easy to crush a company. The Chinese economist Liu Xiaogun lamented the miserable environment in which Chinese companies are placed in the article on September 2. Under the article, comments such as, this is the reality that private companies face, and the reason why the rich do not want to do business in China were well understood. Due to the collapse of the real estate market, the main resource of the local government, land sales revenue, has been dramatically reduced. The local government, which depended on land revenue, has lost its funds, and public servants' wages have not been paid. In addition, the local government's finances are rapidly expanding. According to the latest report published by the Chinese Ministry of Finance, the total budget of the local government in 2023 reached about 40 trillion yuan, which accounts for more than 30% of China's domestic total GDP. The rapidly increasing budget is a source of concern for the local government. With only land sales revenue and tax revenue, which have been the main source of income so far, it is a situation in which the government cannot make ends meet, and it must look for a new source of income. A director of a prefecture on the coast of China said, the income target that the small government delivers every year is a great pressure on the local government. The director said, In order to compensate for the shortfall, it is necessary to increase taxes and other ways to supplement income. According to the director, the main source of income for the local government is the Zergo Maitie. In other words, it is a way to procure funds by selling the right to use the national resource owned by the local government, the right to mine, the right to use real estate and large facilities. It is said that many local governments have set up Zergo Maitie offices in charge of such policies. The funds collected by these means are classified as income other than taxes in the government budget. According to China's official data, the dependence on the local government's non-tax revenue is increasing year by year. According to China's Ministry of Finance, the budget revenue of the first half of this year decreased by 2.8%, but the tax revenue decreased by 5.6%, and the non-tax revenue increased by 11.7%, exceeding the annual non-tax revenue in 2014. In addition, out of the 23 provinces that published the budget data for the first half of the year, it became clear that one-third of the total revenue of the government is non-tax revenue in several provinces. Non-tax revenue, which is becoming the main source of the government, but some of it comes from fines and additional taxes on private companies. Ryu Shogun, an economist from China, pointed out that the government's approach further deteriorates the management of companies and significantly destroys the business environment. According to the statistics from January to July 2024, the rate of investment in state-owned companies increased by 6.3%, while the rate of increase in private investment was almost 0%. In addition, some regions are asking for a pre-payment of taxes on companies. Wang, who runs a chemical factory in the eastern part of Anji Province, said, If we refuse the pre-payment, the authorities will harass us in various ways. It can't be helped, but we have no choice but to pay the tax. Yang, who is in charge of financial management in the southern part of China, said that the local government may ask companies to pay the tax. When the budget is tight, we ask for cooperation from good-related companies and ask them to pre-pay several units of tax. He said, If we do so, the budget situation will be twice as good, and we will be able to compensate even if the deadline is approaching. On the other hand, a restaurant owner in Santoshou said that the fines and taxes he paid last year have increased by more than twice. By abolishing the pre-payment, there is also a movement to secure resources. Yang, who is in charge of financial management, said, When the budget situation becomes tight, we can no longer afford to maintain the pre-payment. Lin, who runs a security company in Shanghai, has been greatly influenced by the government's policy changes. In 2019, the local government of Shanghai promised to provide 5 million yuan in tax relief every year, and Lin set up a company under the conditions. However, in 2024, the policy was suddenly withdrawn, and a fine of 2,023 yen was imposed. Due to the rapid change in policy, Lin's financial plan was greatly confused. Xia Moshou, a senior researcher at the Seiga University National Strategic Research Institute, said, The local government of China is certainly facing financial difficulties, but it is not natural to impose pre-payments on private companies. Xia said, Expanding income other than taxes by law-abiding means is equivalent to drinking poison to replenish water. He said, There is no possibility of sustainability because there is a risk of the people's rebellion and the company's retirement. Economists also believe that the Chinese economy is in a far-fetched state of recovery. Morgan Stanley, the chief economist in charge of China, said, China's housing price is likely to remain unstable in 2025 or in the next few years, and the real estate market has not yet collapsed.