The application by Yunnan authorities to sell 400,000 more cartons of cigarettes in order to raise tax revenue to spend on earthquake relief makes me feel very uncomfortable.
At present, it's common to see local governments short of money. In the first seven months of this year, the national fiscal revenue increased 11.6 percent year-on-year. However, the growth rate dropped by 18.9 percentage points and the fiscal situation of local governments is not optimistic, with a deficit gap of 1.5807 trillion yuan ($249.6 billion).
In cases of sudden disaster, local governments are very likely to be stretched in dispatching relief and financial resources. Therefore, it is reasonable for the Yunnan government to raise relief funds by using every means available after the earthquake. Nevertheless, we can't help suspect the real motives behind applying for an increased quota to sell more cigarettes are quite different.
