The Invisible Constitution in Comparative Perspective

University Law Journal 800, 802. [徐键：“分税制下的财权集中配置：过程及其影响”, 《中

外法学》

2012 年第4期，第 802 页。]

48 

In 1982, there were nine regulatory documents made by other departments of the State Coun-

cil during September 1981 to February 1982 ultra vires relating to tax affairs, out of thirteen  

selected randomly by the financial ministry. See Cui Wei, ‘The Origin of the Highly Centralised  

tax Legislative Power’ (2012) Peking University Law Journal 762, 776. [崔威：“税收立法高度

集权模式的起源

”,《中外法学》2012 年第 4 期，第 776 页。]

49 

Xu Jian, Supra note 47, 811.

50 

Qiao Xiaoyang, ‘Legislating the Law-making Law, Promoting the Rule of Law: A Speech in the 

Workshop of Drafting the Law-making Law’ (1997) 3 Administrative Law Review 1, 2, 3. [乔晓

阳：

“制定立法法，促进依法治国——在《立法法》起草工作研讨会上的讲话（1997年4

月

9日)”,《行政法学研究》1997年第3期, 第2、3页。] Qiao was then the deputy director of 

the legislative affairs commission of the NPC Standing Committee.

---

414 

Han Zhai

concerning the national legal hierarchy. This system has been further consol-

idated by its recent amendment in 2015, which places further limitations on 

delegated legislation with a stronger tone of the tax legality.

51

 Centralisation of 

tax legislation power essentially established the constitutional bottom line of 

the unitary system.

The system of separating tax revenues has been evolving along a clear chro-

nology entwined with two core issues: its implementation below the provin-

cial level, and the distribution of administrative functions and responsibilities 

in line with the central-provincial fiscal relationship. In 1996, the Finance 

Ministry released an official notice of its intention to improve the adminis-

tration of the system separating tax revenue below the provincial level.

52

 In 

2002, the State Council approved and transmitted a similar suggestion to the 

Finance Ministry, which indicated the chaotic administration of fiscal affairs 

below the provincial level.

53

 Direct provincial administration at the county 

level was established in 2009 and has enhanced provincial power in fiscal 

administration and aims to implement the separation of tax reform at levels 

lower than every province.

54

The 1994 tax-separating reform was not complete; it left an uncoordinated 

system of administrative and expenditure responsibilities at the local level. 

Following the State Council’s decision in 1993, the Budget Law confirmed 

the system separating tax revenues in 1994.

55

 In the following year, the State 

Council released regulations implementing the Budget Law. These regu-

lations, which separated tax attribution between the central and local gov-

ernments, theoretically complied with vertical administrative distribution.

56

 

However, since the objective of separating the tax revenues was to strengthen 

the fiscal capacity of the central government, the central government has been 

slow to promote tax and revenue reform that distributes expenditure responsi-

bilities in proportion to the fiscal capacity of governments at each lower level. 

51 

Article 8(6), the Law-making Law of the PRC (2000, rev. 2015).

52 

The Finance Ministry of the PRC, ‘Notice on improving the separating tax revenues admin-

istration system below the provincial level’ [《关于完善省以下分税制财税管理体制有关问

题的通知》

] (1996) 

www.reformdata.org/content/19951226/7992.html

.

53 

‘Opinions on improving the separating tax revenues administration system below the provin-

cial level’ [《关于完善省以下财政管理体制有关问题的意见》] (2009) 

www.moa.gov.cn/

zwllm/zcfg/flfg/200601/t20060123_541180.htm

.

54 

‘Opinions of the Ministry of Finance on boosting the reform of public finance of counties di-

rectly governed by provinces’ [《财政部关于推进省直接管理县财政改革的意见》] (2009) 

www.mof.gov.cn/pub/czzz/zhongguocaizhengzazhishe_daohanglanmu/zhongguocaizheng-

zazhishe_zhengcefagui/200909/t20090914_207256.html

.

55 

Article 15, Budget Law of the PRC (1995, rev. 2014).

56 

Article 6, Regulation for the Implementation of the Budget Law of the PRC (1995).

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The ‘Invisible Constitution’ seen Realistically 

415

The absence of a constitutional principle of expenditure responsibility division 

between the central government and the local ones has been criticised as an 

inconsistent drawback delaying the separating tax reform.

57

 The tax revenue 

system is intended to be based on the vertical distribution of public adminis-

tration with proper expenditure responsibilities, but this crucial principle of 

modern fiscal systems has remained largely unimplemented in China’s case 

for over three decades. The system separating tax revenues eventually evolved 

into a system that contains a centralised fiscal system and a growing local 

expenditure burden. In 2016, the State Council released guidelines on pro-

moting reform relating to the division of financial powers and expenditure 

responsibilities between the central and local governments.

58

 These reforms 

aim to clarify the expenditure responsibilities of governments at different  

levels and improve government efficiency in providing public services.

14.3.2.  Regional National Autonomy with Ethnic Features

Unlike the clear distribution of power between the state and federal govern-

ments and the residual powers left to the states in some federal constitutions, 

RNA under China’s constitutional framework lacks a list of reserved autono-

mous powers. Beyond regional autonomy is the authority at the upper levels 

of government, including the central authorities.

The real power structure of the autonomous regions under the unitary sys-

tem is the premise of discussing what type of power the autonomous areas 

essentially enjoy. Article 4(3) of the 1982 Constitution provides the establish-

ment of the RNA, ‘Regional autonomy is practised in areas where people of 

minority nationalities live in compact communities; in these areas, organs of 

self-government are established for the exercise of the right of autonomy. All 

the national autonomous areas are inalienable parts of the People’s Republic 

of China’. This expression offers some basic characteristics of the RNA, such 

as its ethnic features, organs of self-government and the supremacy of national 

unity. While this Article does not provide sufficient information about the 

operation of regional autonomy, the picture becomes clearer when we refer to 

Article 30, which concerns the ‘administrative division’ of power.

57 

Zhou Feizhou, ‘A Decade of Tax-Sharing: The System and Its Evolution’ (2006) 6 Social Sciences  

in China  100,  102. [周飞舟：“分税制十年：制度及其影响”,《中国社会科学》2006年第 

06期，第 102 页。]

58 

‘The State Council’s Guideline on Promoting the Reform of Dividing Financial Powers and 

Expenditure Responsibilities between Central and Local Governments’ [2016] 26 Bulletin of 

the State Council of the People’s Republic of China 16–22. [“国务院关于推进中央与地方财

政事权和支出责任划分改革的指导意见

”,《国务院公报》2016年第26号, 第 16–22 页。]

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416 

Han Zhai

Article 30 of the 1982 Constitution provides the fundamental structure of 

the unitary system and its ‘administrative division’, which is established based 

on the province-city/county-town structure as a three-tiered division. Notably, 

the RNA areas in this chapter are institutionally ‘integrated’ into the unitary 

system. There are also three levels of authorities in the RNA system exercising 

both autonomous powers and ordinary powers of the non-autonomous author-

ities. Autonomous regions, autonomous prefectures and autonomous counties 

are parallel to provinces, cities and counties in general.

The State Council

(the Central Government of the PRC)

provinces and