Taxation as the Core of Social Control

China's tax system plays a crucial role in its government control and resource management, overshadowing other factors like the financial system and land ownership. While China's tax revenue reached around 23-24% of GDP a decade ago, signifying success in building a functional tax system post-market transition, this ratio has seen a steep decline to below 14% in recent years. This downward trend poses sustainability challenges for public finance and is linked to policy changes introduced by Xi Jinping, highlighting the evolving landscape of China's fiscal management.