China's 800M Peasants Escape Yoke Of Farm Tax

A 2,000-year-old grievance will be lifted next year when China scraps taxes for hundreds of millions of peasants, the government's traditional source of revenue.

Reforms introduced as proof of China's commitment to those left behind by the economic boom are so far ahead of schedule that farm taxes, which date back to before the first emperor, will be abolished early, the finance minister, Jin Renqing, said.

Local governments would be compensated for the loss of income from central funds.

Taxes have been one of the peasantry's great historical grievances. Even today, while urban residents pay income tax and businesses tax on profits, China's 800 million registered rural dwellers pay flat-rate taxes on crops, irrespective of the profits they make.

The system has contributed to a widening gap in income between city and country, which the ruling Communist Party now believes is one of the biggest threats to its rule. Incidents of rural unrest are increasing sharply.

Agricultural tax amounted to an average of 300 yuan (£20) per family when reforms were announced last year. Although small, that figure amounted to more than 10 per cent of rural per capita income. "Farmers, with or without income, 100-year-olds or newborns, have to pay the same tax," Wen Tiejun, an economist with the China Society for Economic Reform, said.

Yet the income it raises is only about one per cent of government revenues. In 1950, as Chairman Mao began his land reforms, that proportion was over 40 per cent.

This week's announcement comes in the wake of reports showing that inequality is reaching a level often associated by economists with social instability. Urban incomes were 3.3 times those in rural areas, according to People's Daily this month, and the real difference was even greater owing to extra subsidies, such as for health care, available to city-dwellers.

Although the government's new concern for the poor, particularly since the change of leadership in 2003, has won support from rural activists, it has done nothing to reduce incidents of unrest, which have been increasing and are becoming more violent, as shown by a recent riot in southern China which led to several villagers being shot dead by paramilitary police.

This is because the formal rural tax is now only one of a number of payments local officials can extract, which range from one-off "fees" to fines for breaching the one-child policy. In addition, many of the reported protests relate to expropriation of land for development.

Some analysts fear that reducing the ability of local governments to raise taxes will only exacerbate their inability to pay proper compensation for the land they give to business as China's economic growth continues.

before we stop paying

I'm not saying the United States has a king, but--

8According to all the works which they have done since the day that I brought them up out of Egypt even unto this day, wherewith they have forsaken me, and served other gods, so do they also unto thee.

9Now therefore hearken unto their voice: howbeit yet protest solemnly unto them, and shew them the manner of the king that shall reign over them.

10And Samuel told all the words of the LORD unto the people that asked of him a king.

11And he said, This will be the manner of the king that shall reign over you: He will take your sons, and appoint them for himself, for his chariots, and to be his horsemen; and some shall run before his chariots.

12And he will appoint him captains over thousands, and captains over fifties; and will set them to ear his ground, and to reap his harvest, and to make his instruments of war, and instruments of his chariots.

13And he will take your daughters to be confectionaries, and to be cooks, and to be bakers.

14And he will take your fields, and your vineyards, and your oliveyards, even the best of them, and give them to his servants.

15And he will take the tenth of your seed, and of your vineyards, and give to his officers, and to his servants.

16And he will take your menservants, and your maidservants, and your goodliest young men, and your asses, and put them to his work.

17He will take the tenth of your sheep: and ye shall be his servants.

18And ye shall cry out in that day because of your king which ye shall have chosen you; and the LORD will not hear you in that day.

19Nevertheless the people refused to obey the voice of Samuel; and they said, Nay; but we will have a king over us;

1 Samuel 8-19 (King James Version)

BibleGateway

This is another step in the dissolution of China.

No government ever willingly gives up tax revenue. Never. Not without getting another tax in exchange. But here we see only the elimination of taxes on farmers.

Why?

The only reason they reduced taxes is the government is afraid of the farmers. Afraid of the power of the farmers. Afraid the farmers will form the basis of political change.

The government believes the rural citizens are prepared to use violence to eliminate the incompetent and corrupt government that takes their income and fails to provide the public goods the people demand.

China is cooked.

China will break up into 10 separate countries within 10 years.

RE: "China will break up into 10 separate countries within 10 years."

I hope that you are right. I'd settle for a second "agrarian reformer" revolution by Mao ideological purists.

That would end our "free traders'" free tradin' transfer of technology, wealth (FDI), and jobs to Red China. Let the Commies spend their own damn money to build the PLA war machine.

Nevertheless, it's nice to see something about the 800 million left behind. All we hear about are the "exploding Chinese economy" and the "rapidly growing middle class." B.S. That only applies to some in the special economic zones.

Meanwhile there are some 60,000+ incidents of confrontations between citizens and government every year and growing.

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