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Beneath the Banyan Tree: Popular Views of Taxation and the State during the Republican and Reform Eras by Patricia Thornton In a scathing assessment of the state of local governance and taxation in Nanjing Decade China, social critic Lin Yutang wrote in 1935,1 Yamen families may indeed well be the banyan tree whose roots cross and recross each other and spread fanwise, and Chinese society to a banyan forest on a hill....The common people are the soil which nourishes these trees and gives them sustenance and makes them grow...the gentry are the parasites, which have a way of reaching the top of the highest tree without great effort, and all Chinese banyans are surrounded by such parasites . In other·words, they can reach the trees and whisper a kind word for the sap of the earth, incidentally pocketing a commission. More than that, they often undertake from the tree the duty of draining the sap of the earth....They parcel out the butchery tax, the prostitution tax and the gambling tax, and from what they invest in, they naturally expect to get the greatest returns. This idea of the 'greatest returns' proves ruinous to the people. There is no limit to their rapacity, for no definition of 'the greatest' is possible .2 Lin's vivid description of the predatory nature of local taxation in the Republican era bears a striking resemblance to popular accounts of fiscal practices in the Chinese countryside today. One farmer from Zhouhe Village in Henan's Xin County complained to the People's Daily in 1996: The roads are fixed by the farmers, with their own labor and their own money. But to ride [on them] in a car, they still must pay exorbitant automobile fees....What about when farmers must send a letter? The envelope must be stamped by one's county post office, and when you go to the post and telecommunications office, you have to send it as an express letter. When picking up a parcel, you must pay a storage fee, whether or not you retrieved it on time. When picking up a remittance of funds, you must once again pay the postal fee that was paid when the money was sent. I once asked a postal clerk, 'Have you people contracted this office from the government? Even Twentieth-Century China, Vol. XXV, No.1 (November 1999): 1-42. 2 Twentieth-Century China the central state doesn't have this many fees and regulations!' He said it was because this is a rural village. But if that's so, then who can afford to be a farmer anymore?3 During both the Nanjing Decade and post-Mao reform periods in mainland China, ambitious programs of rural reform and economic development undertaken by local governments sparked astronomical increases in taxes, surcharges and administrative fines. In the face of rising expenditure responsibilities , county and sub-county administrations during both periods frantically sought out new sources of revenue not eligible for transfer to higher levels of government . Mobilizing an array of resources available to them, county and sub-county administrators in both periods adopted what I term an "entrepreneurial" stance toward the task of revenue collection, affixing surcharges to official taxes, creating new categories of levies for county and sub-county use, and doggedly imposing various tolls, fines and penalties within their jurisdictions. As local farmers were squeezed in the double bind caused by rising taxes and unstable incomes, rising numbers in both periods found themselves unable to meet such demands, and local governments appealed to public security and militia forces under their control to assist them in tax collection. Alarmed by the deteriorating situation in the countryside, central authorities in both cases outlawed such measures and directed local governments to consolidate tax collection practices and standardize procedures. However, insofar as a satisfactory solution to such fiscal dilemmas involved the conclusion of satisfactory revenue sharing agreements between local and central state organs, in both cases the burdens on taxpayers continued, leading to widespread rural social unrest. The so-called "peasant burden" (nongmin fudan) problem in both the Republican and post-Mao reform periods lies at the confluence of several streams...


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