China’s three-year “zero-COVID” approach has devastated the nation’s economy and fiscal revenue, and seriously diminished its tax base.
Looking at the scale of the impact of zero-COVID on China’s economy, Zhang Tao, an economist serving China Construction Bank’s financial markets department, admitted in an article published on a Chinese tech company’s website Sina.com on Dec. 9 that “… we also objectively recognize that the three-year epidemic has severely impacted micro-economic entities. The main body’s economic expectations have almost fallen to the bottom.”
Excluding factors affected by tax breaks and exemptions policies, the calculation shows that China’s tax base contracted by 15 percent from the pre-epidemic base level, Zhang said….