China’s Xi Jinping calls for wealth redistribution and crackdown on high incomes

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China politics and policy updates

President Xi Jinping called for strengthening “high-income regulation,” the latest sign that a 10-month campaign targeting China’s largest technology companies is rapidly expanding to cover broader social goals.

State media reported that the meeting of the CPC Central Committee for Finance and Economics hosted by Xi Jinping on Tuesday emphasized the need to “regulate excessively high incomes and encourage more high-income groups and enterprises to return to society.”

The committee added that although the party allowed some people and regions to “get rich first” in the first few decades of China’s reform and opening up, it now puts “common prosperity” first.

China’s The richest entrepreneur It has been under increasing pressure since November, when Jack Ma Ant Group’s planned US$37 billion initial public offering Internet Tycoon Criticized the country’s financial regulators.

Recently, the ride-hailing company Didi Chuxing After ignoring their warning to postpone a US$4.4 billion listing in the United States, the company was severely criticized by officials.Strict new regulations for China’s booming development Tutoring industryWhat Xi Jinping has repeatedly criticized has also triggered a sharp sell-off of Chinese companies listed in New York.

The Committee on Fiscal and Economic Affairs, which usually pays attention to macroeconomic and financial policies, mentioned cracking down on education, saying that China must “create more inclusive and fair conditions for people to improve their education.”

This is the first time Xi Jinping has presided over the meeting publicly since late July. Party leaders have traditionally retreated to the seaside resort of Beidaihe in early August for policy review, although there has been no official confirmation of the annual retreat in recent weeks.

Wang Jun of the China Center for International Economic Exchanges, a think tank in Beijing, said: “Stagnation consumption data shows that increasing people’s income and paying more attention to fairness in distribution are imminent.”

A Chinese entrepreneur said that re-emphasis on inequality and other Social IssuesCoupled with the recent suppression of Didi and education companies, a clear signal has been sent to private companies.

“This sends a very strong message to every company,” said the entrepreneur, who asked not to be named. “The party wants to have a stronger say in your business, and they want you to be more obedient.”

In late April, three state-owned entities held 1% of Bytedance’s Beijing subsidiary and board seats. Bytedance controls TikTok and other popular short video applications.

The equity first reported by The Information sparked speculation that the Chinese The government may promote “Golden shares” and board representatives of other technology companies, especially at the parent company level.

The head of a large private charity stated that the pressure on the private sector has resulted in “a substantial increase in corporate donations.”

“It’s time for the authorities to resolve the income gap,” the charity executive said. “But most of the donations went to charities supported by the government, with little supervision.”

Supplementary report by Liu Xinning in Beijing

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