The Central Power

On May 23rd, government officials stood out and clarified the rumor regarding that government scheduled to increase stamp tax was wrong. "We never receive any information about the change in stamp tax." one of officials said to the media. But yesterday, May 29th, stamp tax increased by 3 times, from 1‰ to 3‰ !

Stock market, which has already been pushed to a unthinkable and unsustainable point, suddenly shocked. Shanghai Composite Index fell by almost 300 points, closed at 4053. More than 900 stocks fell. Most stocks in my personal portfolio decreased by 10%, the maximum daily decreasing amount, according to the regulation of China's stock market. What's worse, ¥1,234,500,000,000 (approximately $161 billion) were retreated from the market in one day!

Holy crap!

I called my parents, telling them, "I am very sorry for the loss I made." But my father said he was very sorry for the unreliable government. Today, the story has been widely reported and spreaded in China: the Central Government adjusted the stamp tax in the midnight right before the following trading day! Wow~~The central power--you just can rock anything at will.

(above: Holy Crap! How could you hurt me in this way?)

There are sizzling discussions on the web forum, possibly the only way most Chinese feel safe to threw out their opinions. Obviously, on forums, everyone is pissed off. Many critic voices have raised.

Actually, the central government is gaining great amount of revenue on stamp tax from stock trading. The tax revenue on stamp increased by 515.9%, ¥ 12.2 billion (approximately $1.6 billion) more tax payments in the first season of this year! Thank for your people--they paid you so well !

Folks say the government is too greedy, however, the officials argued that it was the most efficient way to cool down the overheating market. From the historic view, the government's action was right. Every time they increased the stamp tax, the stock market collapsed.

Well, if central government wanted the market going back to the normal railroad, they did right thing. However, what they sacrificed is the trust from people. Do you think the "unshakable" Central Power will keep powerful without the public support? I strongly doubt that.