China’s fiscal system has gone through three basic phases. Before 1979, the central government had a formal monopoly over both revenues and expenditures. Between 1979 and 1993, under the economic reforms championed by Deng Xiaoping and his supporters, this fiscal system changed to a fiscal contract system, but there were at least six different types of contracts between provinces and the center, and little consistency between provinces or over time. Provinces generally collected most of the revenue and then turned over a contracted portion to the center – sometimes a quota amount, sometimes a fixed share, sometime.
