China’s Local governments Increase fines Amid Economic Downturn, Sparking Public Outcry

Facing mounting economic pressures and strained local budgets, local governments across China are increasingly resorting to fines and penalties to boost revenue, a practice dubbed “fine-style law enforcement.” This trend, impacting businesses and individuals alike, has ignited public anger and prompted calls for reform. The departments most frequently involved include transportation and urban management.

The Rise of “Fine-Style Law Enforcement”

The phrase “fines as long as they don’t have money” has become increasingly common among Chinese citizens, reflecting a growing frustration with local government practices. To alleviate financial strain, authorities are conducting frequent inspections and imposing penalties on enterprises and individual operators for violations related to traffic, urban management, and municipal supervision. Small and medium-sized business owners, ordinary citizens, and farmers are among those affected.

Did You Know? The Chinese government’s Ministry of Finance reported that national non-tax revenue increased by 25.4% in 2024, reaching 4.473 billion yuan, largely due to increased fines and confiscations.

Examples of Excessive Fines

Reports of disproportionate fines are widespread. Such as,*China Newsweek* reported on June 21,2025,that a farmer in Jiangsu province who earned only 180 yuan from selling unquarantined mutton was fined 100,000 yuan by the Market Supervision Bureau. Similarly, a company in Shandong province faced hundreds of administrative inspections annually from 2021 to 2023, severely impacting its operations.

He Li, a resident of Changshu, Jiangsu, recounted that her daughter’s clothing factory was fined 300,000 yuan for purchasing clothing products worth 150,000 yuan suspected of trademark infringement. “The people who came to check said that these goods have no registered trademarks and will be sentenced,” she stated.

Forced Purchases and Community Fines

Beyond fines, authorities are also allegedly forcing businesses to purchase designated equipment. He Li noted that companies are compelled to buy security products of questionable quality under the threat of fines for safety hazards.

Liu Heyang, a restaurant owner in Taixing City, Jiangsu Province, shared a similar experience, stating that he was required to replace his gas tank with a government-designated one at a higher price. Even household gas meters are subject to mandatory replacements with “officially designated” models, with supply cut off for non-compliance.

The scope of these measures extends beyond businesses. Sun Hao, a resident of Zhengzhou, reported a significant increase in urban management and traffic police presence in his community, specifically targeting randomly parked bicycles with fines ranging from 50 to 100 yuan. He also alleged that traffic police are “setting up ambush” at intersections to penalize parking violations, suggesting a commission-based system.

public Outcry and Rectification Efforts

The surge in fines has triggered widespread criticism on social media, with users reporting inconsistent enforcement standards and arbitrary penalties. One netizen commented on TikTok that “the amount of punishment depends on their mood,” while others noted disparities in fines for similar offenses.

In response to growing public discontent, over 20 provinces, including Beijing, Shanghai, Jiangsu, and Zhejiang, have issued policy documents to rectify “enterprise-related law enforcement” and launched special rectification actions. More than 60% of regions have established a “joint inspection mechanism,” and provinces like Fujian, Guangdong, and Zhejiang have developed online complaint platforms to facilitate reporting of repeated law enforcement and excessive intervention.

Pro Tip: If you are a business owner in China, familiarize yourself with local regulations and document all interactions with law enforcement agencies. Consider joining industry associations for collective bargaining power.

Expert Opinions and Financial Implications

Mr.Zhou, a wuhan rights activist, believes that local governments frequently enough prioritize local interests over central policies, with fines and confiscation income often benefiting local finances.”The more fines, the more they are returned, which encourages them to continue doing this,” he explained.

He further emphasized that “random fines” not only burden enterprises and the public but also erode government credibility, especially amid continued financial pressures.

Key Metrics: Fines and Confiscations in China

Did You Know? The correct format for a Chinese phone number with the country code is +86 followed by the 11-digit mobile number [2].

The Broader Context

The increased reliance on fines by local governments in China reflects a complex interplay of economic pressures, policy implementation challenges, and governance issues. As China navigates its economic transition, the need for transparent and equitable law enforcement practices becomes increasingly critical to maintain public trust and foster lasting advancement.

What are the long-term implications of this “fine-style law enforcement” on China’s economy?

How can citizens and businesses protect themselves from arbitrary fines and penalties?