On January 23, China's Ministry of Finance today announced the financial data for 2016, which show that China has lesser income at a slower growth rate while having higher expenditure at a faster growth rate, which causes the increase of financial deficits. After researching at the grassroots level for two years, Anbound Think Tank found out that the local financial problems are more serious than what is shown in the statistical data; financial collapse even happened in many places. Facing with this contradiction, our view is very clear; the short-term solution would be expanding the fiscal deficit. As a guide to active fiscal policy, the government can consider continuing to expand the fiscal deficit rate. According to Anbound's research on China's fiscal system reform, China's fiscal deficit ceiling can reach 4.5% if security is considered.