The 1994 tax reforms: The center strikes back

This Research Note presents some preliminary findings concerning the consequences of the 1994 Chinese tax reform on central-local fiscal and administrative relations. Interviews in 1993-1994 and Spring 1995 with local tax officials in Jiangsu Province and materials drawn from Chinese as well as foreign publications indicate that while significant institutional reform has occurred, the central government's attempt to redress the domestic fiscal imbalance has experienced only limited success. The reform stands, however, as a disquieting reminder to local governments of the central government's power to revise fiscal and institutional arrangements.