Abstract: The exposure of the reimbursement scandal in Yunnan in 1882 revealed the tip of the iceberg of provincial financial abuses in the late Qing. In response, the Ministry of Revenue promulgated the eight-point regulations of central government officials’ external subsidies. Central government officials received subsides that were not disbursed from national treasury, but from local funds. In order to pay these subsides, the provinces began to levy taxes in various names and this situation caused criticism from the imperial censors. The reason the Ministry of Revenue did not pay subsidies from the state treasury was mainly based on financial reality. Central finances were in deficit and the central government was not aware of the actual financial situation of the provinces. Extracting external subsidies to provide allowances to central government officials in 1884, was a classic example of financial governance in the history of the Qing dynasty. The central government made technical adjustments under the framework of traditional reimbursement system that allowed subsides to become a part of the official revenue. The implementation of central government regulation of officials’ subsidies concealed the intent of imperial court to diminish financial power of local government.