As even China’s wealthiest provinces continue to run deficits and rely on the central government to make ends meet, Beijing is loosening the reins on the country’s highly centralised fiscal system, with legislation for a new tax category – the local surtax – under way.Late last month, the Ministry of Finance unveiled a draft local surtax law for public consultation. The proposed tax would merge three existing levies – the urban maintenance and construction tax, education surcharge and local...