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The Scale of the Chinese Government from a Comparative Perspective: Fiscal Revenue (No.189, 2018)
2019-01-02
By Gao Shiji, Xu Wei & Xu Xiaoxin, Fundamental Field Research Team of “National Governance System and Capability”, DRC
Research Report, No.189, 2018 (Total 5464) 2018-11-8
Abstract: This report analyzes the trend of the Chinese governmental revenue changes in the past 20 years from the perspective of transnational comparison and compares it with those of the OECD governments from vertical and horizontal angles. The results show that due to the substantial increase of revenues brought by land transferring, the budgetary and off-budget government revenue of China takes up 31 percent in the country’s total GDP currently, lower than the average level of OECD countries which stands at 42 percent and also lower but close to those of Japan, South Korea and the United States. Generally speaking, increasing functions of a government will lead to the expansion of its scale. Therefore, small governments are not always the best. In terms of fiscal revenue, China’s current government scale is compatible with its stage of development. Allowing governmental fiscal revenue to maintain a relatively high proportion is also feasible in China due to the country’s unique conditions. A typical feature of Chinese disposable income structure is that enterprises take up a large proportion while residential sectors a small one. Therefore, China needs to further improve its fiscal structure and further benefit the public with its revenue while maintaining appropriate fiscal revenue scale.
Keywords: fiscal revenue, comparative perspective, OECD countries, modern nation development
